Answer:
In response to a tax cut, the consumption of a consumer who is borrowing constrained INCREASES, whereas the consumption of a forward-looking, unconstrained consumer acting in accord with Ricardian equivalence REMAINS UNCHANGED.
Explanation:
The Ricardian Equivalence theory was one of the pillars of the classical monetary policy theory which was the most accepted macroeconomic theory until the Great Depression devastated the American Economy. Ricardian Equivalence stated that a decrease in taxes will not alter consumer spending nor aggregate demand because households will understand that the lower taxes imposed today must be paid tomorrow through higher taxes, so they would simply save more. Franklin Roosevelt replaced the classical monetary theory by the Keynesian theory and was able to pull the New Deal and finally got America out of the Great Depression.
Whispering Winds Corp. has these accounts at December 31: Common Stock, $12 par, 6,100 shares issued, $73,200; Paid-in Capital in Excess of Par Value $19,600; Retained Earnings $44,600; and Treasury Stock, 560 shares, $12,320.
Required:
Prepare the stockholders’ equity section of the balance sheet.
Answer:
The answer is $125,080.
Explanation:
Common stock = $73,200($12 par x 6,100 shares)
Paid-in Capital = $19,600
Retained Earnings = $44,600;
Treasury Stock = $12,320( for 560 shares).
The stockholders’ equity is therefore :
$73,200 + $19,600 + $44,600 - $12,320
= $125,080.
NOTE: Treasury stock was subtracted from the rest because treasury stocks reduce the total number of stocks outstanding
A company reports total assets of $920,000 and stockholders' equity of $540,000. Calculate the debt ratio. (Round your answer to two decimal places.)
Answer: 41.3%
Explanation:
From the question,
Total assets = $920,000
Stockholders' equity = $540,000
Debt will be the difference between the assets and the equity. This will be:
= $920,000 - $540,000
= $380,000
Debt ratio = Debt / Total assets
= $380,000 / $920,000
= 0.413
= 41.3%
Despite Africa's young, urbanizing population, abundant natural resources, and growing middle class, obstacles that have confronted would-be investors in Africa for years - widespread corruption, a lack of infrastructure and ready talent, and an underdeveloped consumer market - continue to stunt economic growth there. In formulating international strategy for a multinational firm, we would regard these obstacles as
Answer:
Opportunities
Explanation:
In the case when the international strategy is to be formulated for a firm i.e. multinational so the obstacles like infrastructure lacking, ready talent, non-developed consumer market etc would be classified as an opportunities as due to this there is a stunt in a economic growth.
So the given situation represent the opportunities and hence the same is to be considered
Gerald owns 465 shares of stock, with a basis of $2,831. The stock split 3 for 1. Gerald now owns ______ shares at ______ per share.
Answer:
Gerald now owns 1,395 shares at $2.03 per share.
Explanation:
Gerald originally owned 465 stocks, but after the stock split he will own 465 x 3 = 1,395 stocks. His basis though will not change, it will be the same $2,831. So the basis per share = $2,831 / 1,395 stocks = $2.029 ≈ $2.03 per stock. Stock splits do not alter the basis of a portfolio, it only increases the total number of stocks.
The amount of shares Gerald now owns is 1,395 shares and the price per share is $2.03.
When there is a stock split, the number of stock outstanding is increased by a constant number. When there is a stock split 3 for 1, for every 1 stock a shareholder owns, the shareholder now owns 3 stocks.
Number of shares owned = 465 x 3 = 1,395 shares
When there is a stock split, the value of the stock declines per share.
Value per share = $2831 / 1395 = $2.03
To learn more about stock splits, please check: https://brainly.com/question/25513890
Time value of money is an important aspect of money management. Why is it important to know what interest rates, terms of an agreement, and present value are in relationship to future value when making financial decisions
Answer:
Future value and present value are monetary concepts that a business owner uses every day, whether he realizes it or not. The idea is simple: Money in your pocket today is worth more than the same amount received several years in the future. The difference is the effect of inflation and the risk that you may not actually receive the money you expect in the future.
Explanation:
Which of the following is most likely to be the most challenging part of this first step of absolute valuation process?
a. Making the assumptions upon which to project future performance
b. Locating the required historic data within company releases and earnings Statements
c. Dividing the market cap by the number of shares
d. Conducting the necessary mathematics
Answer:
a) making the assumptions upon which to project future performance
Explanation:
Absolute value can be regarded as as a method that utilize discounted cash flow analysis in knowing the worth of a organization financially. It should be noted that making the assumptions upon which to project future performance is most likely to be the most challenging part of this first step of absolute valuation process.
Above each column is a statement about the Federal Reserve. Place each misconception about the Fed listed below in the column with the relevant refuting statement.
1. The Fed is an independent government agency
2. The Fed is overseen by the federal government
3. The Fed conducts monetary policy through open market operations
A. The Federal Reserve lacks nccountability because no one audits the Fed. There is no way to know what really goes on behind the scenes.
B. The Federal Reserve just prints more money when the economy needs it and gives it to link.
C. A government agency should not have so much control over the economy because politicians are always going to do anything to win the next election.
Answer:
1. The Fed is an independent government agency ⇒ C. A government agency should not have so much control over the economy because politicians are always going to do anything to win the next election.
The Fed is an independent government agency that pursues the best economic policy for the nation independent of what politicians want.
2. The Fed is overseen by the federal government ⇒ A. The Federal Reserve lacks accountability because no one audits the Fed. There is no way to know what really goes on behind the scenes.
The Federal government however, gets to oversee the Fed to ensure accountability and best practices.
3. The Fed conducts monetary policy through open market operations ⇒ B. The Federal Reserve just prints more money when the economy needs it and gives it to link.
The Fed does not only oversee the printing of money by the Treasury, they also conduct monetary policy through the use of OMO by buying securities when they want money supply to increase and selling when they want a decrease.
According to modern growth theory, the key to economic growth is Group of answer choices a large pool of unskilled labor. skilled labor. institutions. paved roads. modern buildings.
Answer:
Skilled labor
Explanation:
As per the modern economic growth theory, the economic growth would be possible via expenditure done on research & development and have the knowledge regarding innovations so for this the skilled labor is required that helps in research & development and so for innovations
So as per the given statement, the skilled labor is the correct option
Hence, the same is to be considered
If the nominal interest rate is 6 percent and the rate of inflation is 10 percent, then the real interest rate is:______
Answer:
The real interest rate = - 4 percent
Explanation:
Given:
Nominal interest rate = 6 percent
Rate of inflation = 10 percent
Find:
The real interest rate
Computation:
The real interest rate = Nominal interest rate - Rate of inflation
The real interest rate = 6 - 10
The real interest rate = - 4 percent
The amount of money a person pays each month to secure insurance
coverage is the ____.
O A. premium
O B. collateral
O C. policy
O D. deductible
Desmond's 4-unit complex brings in an average of $1,250 per unit per month. The property is valued at $625,000. What is the gross rent multiplier (GRM) for this property
rialto company collected $5,000 on account. what impact will this transaction have on the firm's current ratio
Answer:
There would be NO IMPACT
Explanation:
From the question, we are informed about, rialto company collected $5,000 on account. In this case there will be no impact of this transaction on the firm's current ratio. The collection on account can be regarded as exchange of asset transaction, any increase change in current asset account cash, then there will be decreases in Accounts Receivable , the ration of current asset to current liabilities gives the current ratio, there is no impact of transaction on the current ratio, since the transaction doesn't affect both the
current asset to current liabilities
You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $60,000. The truck falls into the MACRS 3-year class, and it will be sold after three years for $19,800. Use of the truck will require an increase in NWC (spare parts inventory) of $1,800. The truck will have no effect on revenues, but it is expected to save the firm $20,400 per year in before-tax operating costs, mainly labor. The firm’s marginal tax rate is 34 percent. What will the cash flows for this project be? (Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places.)
Year 0 1 2 3
FCF $ $ $ $
Answer:
NCF year 0 = -$61,800
NCF year 1 = $20,264
NCF year 2 = $22,613.40
NCF year 3 = $32,782.60
Explanation:
initial outlay = $60,000 + $1,800 = $61,800
depreciation expense per year:
year 1 = $60,000 x 33.33% = $20,000
year 2 = $60,000 x 44.85% = $26,910
year 3 = $60,000 x 14.81% = $8,886 residual value = $4,204
after tax salvage value = $19,800 - [($19,800 - $4,204) x 34%] = $14,497.36
cost savings per year = $20,400
net cash flow year 1 = [($20,400 - $20,000) x (1 - 34%)] + $20,000 = $20,264
net cash flow year 2 = [($20,400 - $26,910) x (1 - 34%)] + $26,910 = $22,613.40
net cash flow year 3 = [($20,400 - $8,886) x (1 - 34%)] + $8,886 + $14,497.36 + $1,800 = $32,782.60
Zhang Company reported Cost of goods sold of $855,000, beginning Inventory of $41,200 and ending Inventory of $48,300. The average Inventory amount is:
Answer:
the avergae inventory amount is $44,750
Explanation:
The computation of the average inventory would be
= (Opening inventory + beginning inventory) ÷ 2
= ($41,200 + $48,300) ÷ 2
= $89,500 ÷ 2
= $44,750
hence, the avergae inventory amount is $44,750
We simply applied the above formula so that the correct value could come
And, the same is to be considered
The other values would be ignored
An advantage of paid search marketing is that ________.
Answer:
it is the least expensive channel on a cost-per-exposure basis.
Explanation:
An advantage of paid search marketing is that it is the least expensive channel on a cost-per-exposure basis.
difference between monopoly and perfectly competitive market structure
Answer:
see below
Explanation:
1. In a monopoly, one firm dominates a large market. Only one seller is serving a large number of buyers. In a perfectly competitive market structure, many sellers are competing to sell to many buyers.
2. A monopoly has no competition for its products. There are no close substitutes, which leaves customers with no other option but to buy from the monopoly. In perfect competition, sellers sell identical products. There is stiff competition for the product being sold.
3. In a monopoly, there are strong barriers to entry and exit from the market. In a perfectly competitive market, restrictions on entry or exit are absent.
4. The price for a monopoly is always set above the average cost, while in perfect competition, the price set is equal to the marginal cost.
5. A monopoly has full control over its price and can offer different prices to different groups of customers. In a perfects competition, the firms cannot practice price discrimination because they have no control over prices.
You have set up a life annuity with a present value of $250,000. If your life expectancy at retirement is 25 years, what will your monthly income be if the APR is 8%, compounded monthly?
a. $1978.69
b. $2047.65
c. $1929.54
d. $1889.03
Answer:
The correct answer is C.
Explanation:
Giving the following information:
Present value= $250,000
Number of periods= 25*12= 300 months
Interest rate= 0.08/12 = 0.006667
To calculate the monthly income, we need to use the following formula:
Monthly withdraw= (PV*i) / [1 - (1+i)^(-n)]
Monthly withdraw= (250,000*0.006667) / [1 - [1.006667^-300)
Monthly withdraw= $1,929.6
After Mario completes his monthly report, his boss reviews it to see if the standards were met. If there are errors, Mario is told he has to work an extra hour each day for the next two weeks. This is an example of which type of management. Passive management by exception Active management by transaction Passive management by transaction Active management by exception
Answer: Active management by exception
Explanation:
Active management-by-exception is an active transactional leadership behavior whereby the leader looks out for what has been done wrong by his or her subordinates.
Such leaders monitors the work performance and look out for the mistakes and then corrects the situation by taking a particular action.
Since Mario'd boss reviews his monthly reports to see if the standards were met and that if there are errors, Mario is told he has to work an extra hour each day for the next two weeks. It is an example of Active management by exception
The IBM Corporation invented the ________ benchmark to help with the design of its mainframe systems.
Answer:
Performance
Explanation:
IBM is widely known as the leader in the computer manufacturing business. Hence, they establish performance benchmarking to assess and analyze how the firm's product and services are operating in terms of sales revenue, profit generation, and customer happiness. This performance benchmarking is conducted to evaluate both internal and external performance.
Therefore, The IBM Corporation invented the PERFORMANCE benchmark to help with the design of its mainframe systems.
Drag each example to the corresponding step in the new-product development process.
1. Idea Generation
2. Concept Testing
3. Product Development
4. Market Testing
5. Product Launch
6. Evaluation of Results
A. Samples
B. Big box
C. Brainstorm
D. Prototypes
E. Strong sales
F. Presentation
Answer:
1. Idea Generation ⇒ C. Brainstorm
Brainstorming is a process used to generate a large number of ideas where participating members contribute with any ideas that they can come up with.
2. Concept Testing ⇒ B. Big box
3. Product Development ⇒ D. Prototypes
When a company is developing a product, the firs thing that they will come up with is a prototype of the product.
4. Market Testing ⇒ A. Samples
Free samples are important when you are testing a new product, e.g. handing out free samples
5. Product Launch ⇒ F. Presentation
The formal presentation of a product takes place when the product is launched into the market.
6. Evaluation of Results ⇒ E. Strong sales
The way that a company can evaluate if a product was accepted or not by the market is to see their sales records, if sales are strong, then the product was accepted.
Insourcing incurs an annual fixed cost of $500,000 and a variable cost of $60 per unit. Outsourcing incurs an annual fixed cost of $750,000 and a variable cost of $20 per unit. What is the indifference point between the two alternatives
Answer:
The indifference point is 6,250 units
Explanation:
First, we need to structure the total cost formulas:
Insourcing:
Total cost= 500,000 + 60*x
x= number of untis
Outsourcing:
Total cost= 750,000 + 20*x
x= number of units
Now, we equal both formulas and isolate x:
500,000 + 60x = 750,000 + 20x
40x = 250,000
x= 6,250
The indifference point is 6,250 units
Prove:
Total cost= 500,000 + 60*6,250= $875,000
Total cost= 750,000 + 20*6,250= $875,000
Izzy just received a credit card offer in the mail. The credit card has an APR of 17.16%. What is the monthly interest rate that will apply to any unpaid balances on this credit card
Answer:
1.43%
Explanation:
Given that the monthly interest rate that will apply to any unpaid balances on the credit card will be in compound interest. And therefore, for an APR (Annual Percentage Rate) of 17.16% and assuming a 12 months
Then we have 17.16% divided by the 12 months available.
Hence, in this case, we have 1.43% as the correct answer.
The independent variable in the Situational school of leadership is: a. Maturity of the followers b. Clarity of the task c. Time horizon d. Organizational support for the leader e. b), c), and d) Only
Answer:
Maturity of the followers, clarity of the task, organizational support of the leader
Explanation:
Situational leadership takes into account the situational factors that are attached to the task of the leader. This type of leadership style does not take a one size fits all approach or a universal style of leadership, and therefore pays attention to factors such as relationship with members of the team, type of task etc. The above are factors that determine leadership style. Time horizon is not one of them. Another factor not included in the options is the relationship of the team or group members with the leader.
If Jane Key invests $18,527.74 now and she will receive $40,000 at the end of 10 years, what annual rate of interest will she be earning on her investment?
A. 8.5%
B. 10%
C. 8%
D. 9%
Answer:
C. 8%
Explanation:
Future value factor:
= $18527.74 / $40000
= 0.4631935
At 8% for 10 years the future value factor is 0.4631935
Note: Proof of calculation is attached below as picture
Which inventory costing method generally results in the most recent costs being assigned to ending inventory?
a. LIFO.
b. FIFO.
c. Weighted average cost.
d. Simple average cost.
e. Specific identification.
Answer:
B. FIFO.
Explanation:
This is known in full as First in, First out which has a general ideology that purchases that are been made first are those to be sold also first too.bTherefore it is seen to be the discussed inventory when it comes to recent costing been assigned to ending inventories. They are been assumed to remain inventory consists of items purchased last. In other words, its alternate LIFO is an accounting method in which assets purchased or acquired last are disposed of first. Also it is seen in an inflationary market, lower, older costs are assigned to the cost of goods sold under the FIFO method.
A property and casualty insurance company categorizes its policyholders into three groups: low risk, medium risk, or high risk. 25% of the policyholders are low risk and 30% are high risk. The high risk policyholders are three times as likely as medium risk policyholders to file an insurance claim and the medium risk policyholders are twice as likely as the low risk policyholders to file an insurance claim. Determine the proportion of the insurance claims filed by medium risk policyholders.
Answer:
The correct approach is "0.39".
Explanation:
The given values are:
Low risk percentage,
= 25%
i.e.,
= 0.25
High risk percentage,
= 30%
i.e.,
= 0.30
Now,
The medium risk percentage will be:
= [tex]1-(low+high)[/tex]
= [tex]1-(0.25+0.30)[/tex]
= [tex]1-0.55[/tex]
= [tex]0.45[/tex]
Should let probability of either an assertion by a low-risk policyholder be p,
Percentage of medium risk policyholder will be,
= 2p
Percentage of high risk policyholder will be,
= 3×2p
= 6p
By applying Bayes' theorem, we get
⇒ [tex]P(A | B) = \frac{P(A \$ B)}{P(B)}[/tex]
⇒ [tex]=\frac{(0.25p + 0.45\times 2p)}{(0.25p + 0.45\times 2p + 0.30\times 6p)}[/tex]
⇒ [tex]=\frac{1.15}{2.95}[/tex]
⇒ [tex]=0.39[/tex]
Answer:
the approach is "0.39"
Explanation:
What can Lena do to avoid the risk of having short supplies in times of need?
Lena works in an artificial jewelry-manufacturing unit. It is a family run business, and they have been depending on a single supplier for years.
As Lena is a proactive person, she can avoid the risk of being in short supplies of raw material by keeping a _______ supplier for every one main supplier.
Answer:
Backup
Explanation:
Answer:
Backup
Explanation:
Correct on Plato
The free-rider problem; A. Arise from the ability to exclude an individual from the benefits of someone else's purchase B. Is a government failure resulting from consumption of private goods. C. Reflects the inability to exclude an Individual from the benefits of someone else's purchase. D. Means that the market mechanism is the most efficlent way to produce public goods.
Answer: C. Reflects the inability to exclude an Individual from the benefits of someone else's purchase.
Explanation:
The Free-rider problem is a concept in economics that describes the fact that sometimes people benefit from goods and services that they wither did not pay for or underpaid for.
There has been a failure to exclude those individuals who are free-riding from the benefits of goods and services that other people are paying for. A simple example of the free-rider phenomenon is using Wikipedia. Most of those who use it do not contribute or pay for its upkeep in any way yet reap the benefits of its extensive information.
PLEASE HELP!
Agnes and Sons had ordered 11,500 machine parts. The cost of the parts was $48,000.00. Find the cost
of each part to the nearest whole cent?
Answer:
$4.2 per part
Explanation:
11,500 machine parts were ordered
Total cost of the parts was $48,000.00
the cost per part will be total cost divided by the number of parts
i.e., cost per part = total costs/ number of parts
Cost per part =$48,000 / 11,500
Cost per part =$4.17
=$4.2 per part
Abbott, Inc., issued $50,000 of bonds, paid cash dividends of $8,000, sold long-term investments for $12,000, received $5,000 of dividend revenue, purchased treasury stock for $5,000, and purchased new equipment for $19,000. What is the net cash flow from financing activities?
a. $70,000 inflow.
b. $27,000 inflow.
c. $90,000 inflow.
d. $20,000 outflow.
Answer:
$27,000
Explanation:
Cash flow from financing activities
Particulars Amount
Bond issued $50,000
Less: Cash dividend payment $8,000
Less: Treasury stock purchase $15,000
Net cash-flow from financing $27,000
activities