Answer:
ITEMS TO BE INCLUDED IN THE GDP
1. Honda;s assembly and sales of cars in the U.S.
2. Old Navy Purchases mannequins to display clothes
ITEMS NOT TO BE INCLUDED IN THE GDP OF THE UNITED STATES
1. GM's Assembly and sales of cars in Mexico
2.Resale of used textbooks to college students
3. Ocean spray purchases plastic to make bottles
4. Sales of wheat to Mrs. Baird's Bakery
Explanation:
Completion of the Question is as follows:
The following should be placed into two groups: Group A represents items to be included in the GDP of the U.S and Group B represents items not be included in the GDP of the U.S.
The Items are as follows:
GM's Assembly and sales of cars in Mexico
Old Navy Purchases mannequins to display clothes
Resale of used textbooks to college students
Ocean spray purchases plastic to make bottles
Honda;s assembly and sales of cars in the U.S.
Sales of wheat to Mrs. Baird's Bakery
Solution
Gross Domestic Product (GDP)
The GDP of a nation is the measure of the market value all finished products, goods and services manufactured or rendered within the borders of a particular country and within a period of time usually one year.
This means that any good produced in another country for instance Germany will not be included in the GDP of the United States. Also, GDP considers only finished goods, hence, intermediate or raw materials for finished goods will also not be included in the GDP calculation.
Based on the explanation, the classification is as follows
ITEMS TO BE INCLUDED IN THE GDP
1. Honda's assembly and sales of cars in the U.S. - The cars were assembled in the United States which is a part of production, hence, they qualify for GDP calculation
2. Old Navy Purchases mannequins to display clothes- The Mannequins were bought as a company's finished products and will not be used to produce any new product. They are already in their finished form
ITEMS NOT TO BE INCLUDED IN THE GDP OF THE UNITED STATES
1. GM's Assembly and sales of cars in Mexico- General Motors assembled the cars in Mexico and this does not qualify as manufactured in the United States.
2.Resale of used textbooks to college students- The textbooks were already calculated for GDP in their year of production, hence, a resale value will not qualify for GDP calculation
3. Ocean spray purchases plastic to make bottles - The plastic purchased represent intermediate goods for further processing of bottles, they are raw materials and not finished goods.
4. Sales of wheat to Mrs. Baird's Bakery - The wheat purchased represent intermediate material for further processing of bread, it is a raw material required to produce a finished product - bread.
One of the limitations of aggregate accounting is that:A. it includes market transactions that should be excluded.B. it doesn't take depreciation into account.C. it measures market activity, not social welfare.D. there isn‘t enough data available in most developed countries to havenational income accounts.
Answer:
The correct answer is C
Explanation:
Aggregate accounting is the procedure in which the data from all of the households as well as individuals accounts of the production are gathered in one place.
In short, it is described as the way or method of measuring or evaluating the sum or the total of the production. The limitation of this method is that it only measures or determine the activity of the market not the social welfare.
A 2014 study conducted by Yahoo! revealed that chocolate is the most popular flavor of ice cream in America. c. Suppose improvements in the processing and freezing of strawberries lowers the price of strawberry ice cream. Indicate the possible effects on demand, supply, or both, as well as on the equilibrium price and quantity of chocolate ice cream. The demand curve for chocolate ice cream shifts to the left. shifts to the right. does not shift. The supply curve for chocolate ice cream shifts to the right. does not shift. shifts to the left. The equilibrium price of chocolate ice cream could increase or decrease. increases. decreases. The equilibrium quantity of ice cream increases. could increase or decrease. decreases.
Explanation:
The demand curve for chocolate ice cream : shifts to the left
The supply curve for chocolate ice cream : does not shift
The equilibrium price of chocolate ice cream : decreases
The equilibrium quantity of ice cream : decreases
The law of supply and demand is a principle of the economy which explains the ties between supply and demand and how this relationship affects goods and services ' prices. The idea of supply surpassing demand for a product or service means costs are central to economic policy. Prices tend to rise as demand exceeds supply.
What is an HR metric that would be especially valuable to an organization that wishes to determine whether it should continue to invest resources into the company "Wellness Program" (which has included benefits like free employee gym memberships and health education seminars)? a. SWOT analysis b. Employee satisfaction c. Delphi technique d. Staffing ratios
Answer:
The correct answer is letter "B": Employee satisfaction.
Explanation:
Employee satisfaction refers to the level of joy workers have at work with the current activities they perform. Companies tend to provide additional benefits to employees to increase their engagement with the firm which is believed to boost their efficiency, thus, the company's effectiveness.
Calculate the present values for the perpetuity: (1) Annual amount $20000, discount rate 8% (2) Annual amount $10000, discount rate 10% . A. $100000, $ 250000 B. $ 2500000, $1000000 C. $250000, $100000 D. $20000, $100000
Answer:
Present value calculator calculates the PV of a single amount. ... of illustration, you would rather receive $10,000 today rather than wait a year. ... This rate-of-return calculator solves for the ROR for one invested amount. ... Enter the calculated present value, the discount rate as the annual interest rate ... advertisement 2 short.
Explanation:
You are evaluating the balance sheet for Goodman's Bees Corporation. From the balance sheet you find the following balances: cash and marketable securities = $400,000, accounts receivable = $1,200,000, inventory = $2,100,000, accrued wages and taxes = $500,000, accounts payable = $800,000, and notes payable = $600,000.
Answer:
$1,800,000
Explanation:
The computation of the net working capital is shown below:
Net working capital = Current assets - current liabilities
where,
Current assets = Cash and marketable securities + Accounts receivable + Inventory
= $400,000 + $1,200,000 + $2,100,000
= $3,700,000
And, the current liabilities = accrued wages and taxes + Account payable + notes payable
= $500,000 + $800,000 + $600,000
= $1,900,000
So, the net working capital is
= $3,700,000 - $1,900,000
= $1,800,000
The question asks for an analysis of Goodman's Bees Corporation's balance sheet and includes a scenario that calculates a bank's net worth using a T-account balance sheet.
The question regarding Goodman's Bees Corporation involves analyzing a balance sheet, which is a fundamental concept in accounting and finance. A balance sheet displays a company's financial position at a specific point in time, showing its assets, liabilities, and net worth. In preparing a balance sheet, assets like cash, marketable securities, accounts receivable, and inventory are matched against liabilities such as accrued wages, taxes, accounts payable, and notes payable. The difference between the total assets and liabilities represents the company's net worth or equity.
To better understand the impact of liabilities like accounts payable on a cash flow statement, we can refer to the example of Treehouse's increase in accounts payable, which is an accounting practice that effectively represents a 'cash inflow' from operations because it preserves cash for other uses within the business. When analyzing a company's financial statements, the annual report provides essential details, often supplemented with notes that elaborate on the balance sheet items. As for the given T-account scenario for a bank, the calculation of the bank's net worth would involve setting up the balance sheet with the given reserves, government bonds, loans, and deposits.
Regional Products, Inc. agrees to sell to Quantity Dealers Corporation a certain amount of goods. The contract does not specify where the goods are to be delivered. In general, the UCC requires that the delivery take place at__________
Answer:
Regional Products
Explanation:
According to the UCC where place of delivery is not specified in a transaction, the place of delivery of the goods will be at the seller's place of business.
This will help with inspection, where the buyer has an opportunity to inspect the goods and either accept or reject before transportation cost is incurred.
James is willing to sell his ipod for $20, and the going price on ebay is $15. Given this information, what would be the producer surplus for James? a. $20 b. $15 c. $0 o d.$5 $5
Answer:
c. $0
Explanation:
As the producer surplus is the difference between theminimum price the selles accept to sale and the market price of the good.
In this case the ipod is worth $15 while Jame's price is $20 Thus there is no surplus James mostly won't even sale his ipod.
Answer:
c. $0
Explanation:
Producer surplus is the difference between the amount a producer (in this case James) is willing to sell a product and the market price. In this case the market price is higher than the price James is willing to sell. Therefore the producer surplus is zero.
The valuation of an MNC should rise when an event causes the expected cash flows from foreign to ____ and when foreign currencies denominating these cash flows are expected to ____.
Answer:
Decrease, Depreciate.
Explanation:
What is the appropriate accounting treatment for the value assigned to in-process research and development acquired in a business combination?
Answer:
Capitalize as an asset.
Explanation:
Answer:
The correct answer is: Capitalize as an asset.
Explanation:
Capitalize is an accounting term that describes a company's method of measuring the expense of the assets recorded. Many businesses have procedures on how and when to report purchases and costs as assets or expenses. These are listed on the Balance Sheet as an asset and depreciated as expenses are capitalized. Capitalized expenses make their way to the Income Statement by depreciation.
Thus, the purchases and costs of in-process research and development is capitalized as an asset.
Thomas Friedman, in The World is Flat, describes a world coming to a single global economy with a playing field "flattened" by Select one: a. technological changes. b. a scarcity of resources. c. a few large companies. d. None of the choices are correct.
Answer:
The correct answer is letter "A": technological changes.
Explanation:
American journalist and writer Thomas Friedman (born in 1953) in his 2005 book "The World Is Flat" exposes his conclusion on technology after research he conducted in India. According to Friedman, technology is shaping a new standard economy in the world boosted by computers and the use of the internet.
When a firm has moved beyond a production or selling orientation and attempts to discover and satisfy its customers' needs and wants, the firm is ______.
Answer:
The correct answer is: market oriented.
Explanation:
Market-oriented institutions are those that pursue the satisfaction of consumers more than reaching a profit goal for the company. This position is also taken by companies when the firm is looking for expansion through the implementation of new products or services. Every piece of information provided by consumers are considered vital in this stage.
The Uniform Guidelines on Employee Selection Procedures require validated procedures for selecting and promoting employees but do not apply to dismissal, transfer, or demotion.True/False
Answer:
TRUE
Explanation:
The Standard Employee Selection Regulations refer to all selection process used to take employment choices, including interviews, analysis of qualifications from job application forms, task experiences, physical requirements, and performance evaluations.
It does not represent any information about dismissal, reallocate or reduction in rank of employees.
Olivia deposited $800 at her local credit union in a savings account at the rate of 6.2% paid as simple interest. She will earn interest once a year for the next 7 years. If she were to make no additional deposits or withdrawals, how much money would the credit union owe Olivia in 7 years?a. $1,147.20 b. $149.60 c. $1,218.88 d. $852.68
Answer:
a. $1,147.20
Explanation:
Simple interest means the same amount will be paid as interest per year.
We will use the following formula to solve for Olivia's interest after 7 years.
Interest = principal* interest rate* time
Principal= $800
Interest rate= 6.2%
Time= 7 years
Interest= 800* 0.062* 7
Interest= $347.20
So the total money owed to Olivia is = 800+ 347.20= $1,147.20
Which of the following is true of strategic plans? a. They are developed by middle- and lower-level managers b. They have a short time horizon. c. They have specific and concrete focus.
Answer:C
Explanation:
They have specific and concrete focus
A strategic plan is typically developed by top-level management, has a long-term focus, and provides a broad outline of the company's goals and how they can be achieved
Explanation:Strategic plans are typically developed by top-level executives and decision-makers in a company, so, option 'a' might not be entirely true. A strategic plan generally has a long-term perspective, usually 3 to 5 years or even more, hence, statement 'b' is not accurate. Option 'c' is also not completely accurate because a strategic plan is not typically very specific or concrete, it is often general and broad, providing a big picture outlook for the company it is planned for.
A strategic plan is a document used by businesses to outline their overall goals and the steps they plan to take to achieve these goals. The plan serves as a roadmap for the organization and helps to align the various parts of the organization. It's a critical tool for guiding the decisions and actions of the business and ensuring that everyone is on the same page.
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Does one brand have a more consistent number of chips per cookie? A. No. Both brands have roughly the same number of chips per cookie. B. Yes. The name brand has a more consistent number of chips per cookie. C. Yes. The store brand has a more consistent number of chips per cookie. D. There is insufficient information to draw a conclusion.
Without data on the number of chips per cookie for each brand, it is not possible to determine if one brand has a more consistent number of chips per cookie.
Explanation:The question is asking if one brand has a more consistent number of chips per cookie. To determine this, we would need data on the number of chips per cookie for each brand and analyze the consistency of the data. Without this information, it is not possible to draw a conclusion and the answer would be D. There is insufficient information to draw a conclusion.
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"Why is it important to understand the history of computers? Provide examples of each of the following mechanical computers, electromechanical computers, and early electronic computers"
Explanation:
Understanding the history of computers means understanding several important aspects that have been incorporated into our current life, our ways of working, communicating, shopping, etc. It is a way of understanding how technology has revolutionized and made life easier for the whole society.
The history of computing makes it possible to understand the developments of devices that are simple to calculate, even the technological advances that made the creation of modern computers possible.
Mechanical computers (1642-1945) were the first devices created to aid calculation, such as Pascaline, the first mechanical calculator developed in the world.
The first electromechanical computer, the Mark I, which was built in 1944, was 17 meters long by 2.5 meters high and had a mass of 5 tons. It performed calculations without human intervention but it took about 3 to 5 seconds to perform a multiplication.
The first electronic computer was the ENIAC, inaugurated on February 14, 1946. This computer was a thousand times faster than any previous computer and solved up to 5 thousand calculations of addition and subtraction, 350 multiplications or 50 divisions per second. It was a huge computer that weighed 27 tons and measured 5.50 x 24.40 m and consumed 150 kW. This computer was developed in the second world war, and its main objective was to perform ballistic calculations. Its "operating system" was through punched cards.
Understanding the history of computers helps us appreciate advancements and how technology has evolved. Examples of mechanical computers, electromechanical computers, and early electronic computers include Charles Babbage's Analytical Engine, the Harvard Mark I, and the ENIAC.
Explanation:It is important to understand the history of computers because it helps us appreciate the advancements that have taken place and how they have shaped our lives today. Understanding the history of computers allows us to understand how far we have come and how technology continues to evolve.
Mechanical Computers:
One example of a mechanical computer is Charles Babbage's Analytical Engine, designed in the 1830s. It was the first general-purpose computer that used punched cards to input data and perform calculations. Despite not being built during Babbage's lifetime, the design of the Analytical Engine laid the foundation for future computer developments.
Electromechanical Computers:
A popular example of an electromechanical computer is the Harvard Mark I, developed during the 1930s. It used switches, relays, and rotating shafts for computations and was primarily used for military calculations during World War II. The Mark I was a significant step forward in computer technology and paved the way for faster and more reliable computing.
Early Electronic Computers:
One of the early electronic computers is the ENIAC (Electronic Numerical Integrator and Computer), built in the 1940s. It used vacuum tubes to perform calculations and was used for tasks such as calculating artillery shell trajectories. The ENIAC was colossal in size and required a great amount of power, but it marked an important shift towards more efficient and powerful electronic computing.
Suppose you have noticed that the slope of the corporate yield curve has become steeper over the past few months. What factors might explain the change in the slope?
Answer:
The slope of the corporate yield curve has become steeper over the past few months; it means increasing risk and an increase in expected inflation.
Explanation:
There is an expected profit provided by any corporation to its investors during the time of investing. Expressing that in a graphical form is known as yield curve.
Yield curve is typically becoming steeper when:
• The time to maturity increases and associated interest rate increases as the time to maturity increases.
• It also means greater risk due to the higher likelihood of inflation in the long term and due to the debt issued for longer term.
The steepening of the yield curve may be influenced by factors such as changing interest rates, investor expectations of inflation or economic growth, and monetary policy adjustments. The interconnectedness of assets and changes in non-price variables that affect the supply of financial capital also contribute to shifts in the yield curve.
Explanation:The steepening of a corporate yield curve over time can be attributed to various factors. One key reason is a change in interest rates, particularly if short-term rates remain the same while long-term rates increase. This could be due to expectations of higher inflation or strong economic growth in the future, which would lead investors to demand higher yields for longer maturity investments to compensate for increased risks. Additionally, changes in monetary policy, such as those by the Federal Reserve during the pandemic recession that lowered short-term interest rates to near zero, can also alter the slope of the yield curve.
It is important to consider that all assets are linked, so when the interest rate on short-term government bonds rise, institutions may sell other assets, leading to a rise in their yields. Moreover, non-price variables like changes in income or future needs can shift the supply curve for financial capital, which in turn affects interest rates. The yield curve represents the relationship between interest rate (or yield) and maturity for similar debt instruments, usually Treasury securities, and thus can serve as a bellwether for the economy's direction.
What theory argues that free trade is beneficial, but that differences in factor endowments, not productivity, determine the pattern of international trade? Heckscher-Ohlin Leontief Ricardo Porter-Friedman
Answer:
The correct answer is letter "A": Heckscher-Ohlin.
Explanation:
Named after Swedish economists Eli Heckscher (1879-1952) and Bertil Ohlin (1899-1979), the Heckscher–Ohlin theory states that countries should focus their efforts on producing and exporting those goods they are good at manufacturing and they should import the goods they struggle in making. The concept is based on both the productivity and non-productivity of nations and their best bequests.
Fred is willing to pay $5 for his first slice of pizza and $4 for his second slice of pizza. If the price is $3, and Joe buys two slices of pizza, he receives a total consumer surplus of A) $4. B) $2. C) $7. D) $3
Answer:
D) $3
Explanation:
Consumer Surplus refers to the difference between the actual price paid by a consumer and the price the consumer was willing to pay. Surplus arises in cases wherein the price consumer was willing to pay exceeds the price he actually paid.
In the given case, the consumer was willing to pay a total of $9 i.e ($5 + $4) for 2 units of pizza. He actually ended up paying $6 i.e ($3 × 2 slices).
Thus, his total consumer surplus can be calculated as $9 - $6 = $3
According to economic historians, modern economic growth first happened in a. 1776, when Scottish inventor James Watt perfected a powerful and efficient steam engine b. 1701, when Jethro Tull Invented the seed drill. c. 1765, when Ell Whitney invented the cotton gin. d. 1776, when the American colonies declared their freedom.
Modern economic growth is attributed to the perfection of the steam engine by James Watt in 1776, marking the start of the Industrial Revolution by transitioning from manual to mechanized production.
Explanation:According to economic historians, modern economic growth first happened in 1776, when Scottish inventor James Watt perfected a powerful and efficient steam engine. This invention marked a pivotal moment in history, as it catalyzed the Industrial Revolution, transforming manufacturing processes and transportation. Watt’s steam engine not only made it possible to operate machinery without relying on water power or manual labor but also played a crucial role in improving the production and use of iron, facilitating a surge in industrial productivity and economic growth across Britain and eventually the world.
The choices provided in the question highlight various significant inventions and historical events, but the direct answer aligns with the advancements brought about by James Watt’s steam engine. This invention encapsulates the essence of the Industrial Revolution, making option a the correct answer. It underscores the transition from manual labor to mechanized production, representing a leap towards modern economic dynamics and industrialization.
Residents of your city are charged a fixed weekly fee of $6 for garbage collection. They are allowed to put out as many cans as they wish. The average household disposes of three cans of garbage per week under this plan. Now suppose that your city changes to a "tag" system. Each can of garbage to be collected must have a tag affixed to it. The tags cost $2 each and are not reusable. What effect do you think the introduction of the tag system will have on the total quantity of garbage collected in your city? Under the "tag" system, the total quantity of garbage collected in the city will .
Final answer:
The introduction of the tag system is expected to reduce the total quantity of garbage collected in the city as residents may opt to limit their disposal to the average three cans.
Explanation:
In the current garbage collection system, residents are charged a fixed fee of $6 per week and can dispose of as many cans of garbage as they want. Under this system, the average household disposes of three cans of garbage per week. If the city changes to a tag system, where each can of garbage requires a $2 tag that is not reusable, it is likely that the total quantity of garbage collected in the city will decrease.
The introduction of the tag system will likely discourage residents from disposing of excess garbage, as they would need to purchase a tag for each additional can beyond the average three cans. This added cost incentivizes individuals to be more mindful of their waste and potentially reduce the amount of garbage they produce.
Therefore, the tag system is expected to reduce the total quantity of garbage collected in the city, as households may opt to limit their disposal to the average three cans to avoid the additional expense of purchasing tags.
John: "I will sell you my laptop computer for $330." Mary: "Will you include the carrying case"? John: "Sold." a. There is a contract for the sale of the computer with the carrying case. b. There is a contract for the sale of the computer but the carrying case is not included. c. There is no contract for the sale of the laptop computer. d. There is a contract but it is unenforceable because it must be in writing. e. none of the above
Answer:
Correct answer is a, there is a contract for the sale of computer with the carrying case
Explanation:
There is a contract between John and Mary to sell the laptop computer with the carrying case. Mary's counter offer to buy the laptop computer if the carrying case is included is indirectly accepted by John by replying "sold". That only means there is a meeting of minds between the two contracting parties the seller (John) and the buyer who counter offered (Mary) to sell the laptop computer with the carrying case.
Jenny manages sales dealership of high-end luxury brand of automobile. Her target market is limited to a specific social class, which restricts her customer base. If her company creates cars for middle class consumers she risks:__________
Answer:
The correct answer is letter "A": cheapening his brand .
Explanation:
Businesses of luxury objects such as advanced-technology vehicles have a differential advantage related to other carmakers. Most of their customers prefer those cars because they give them a certain status in society and are accessible to a few people because of the high prices.
Then, if Jeff's companies decide to manufacture cars for the middle class, the dealer risks cheapening the brand but the number of customers could exponentially increase.
Blue Spruce Corp. recorded the following cash transactions for the year: Paid $133500 for salaries. Paid $55200 to purchase office equipment. Paid $15100 for utilities. Paid $5600 in dividends. Collected $279000 from customers. What was Blue's net cash provided by operating activities?
Answer:
$130,040
Explanation:
The cash flow using the indirect method has 3 groups of activities namely; operating, investing and financing.
Given the following activities;
Paid $133500 for salaries, Paid $55200 to purchase office equipment, Paid $15100 for utilities, Paid $5600 in dividends. Collected $279000 from customers,
The operating activities are Paid $133500 for salaries, Paid $15100 for utilities and Collected $279000 from customers,
Thus,
Blue's net cash provided by operating activities = -$133500 - $15100 + $279000
= $130,040
Mario won the lottery and is receiving payments of $1,521,875 a year for the next 19 years. However, he has decided to sell this income stream and has been offered $9,968,843 for the remaining lottery payments. What is the discount rate used by the potential buyer?
The discount rate used by the potential buyer is approximately 7.5%, as it yields a present value close to the offered price of $9,968,843.
To find the discount rate used by the potential buyer, we can use the present value formula for an annuity:
[tex]\[ PV = Pmt \times \frac{{1 - (1 + r)^{-n}}}{{r}} \][/tex]
Where:
- [tex]\( PV \)[/tex] is the present value of the annuity (the offer price, $9,968,843),
-[tex]\( Pmt \)[/tex]is the annual payment received by Mario ($1,521,875),
- [tex]\( r \)[/tex] is the discount rate (the rate used by the buyer),
- [tex]\( n \)[/tex] is the number of years remaining in the annuity (19 years).
Substituting the given values into the formula:
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1 + r)^{-19}}}{{r}} \][/tex]
To find [tex]\( r \)[/tex], we can use trial and error or numerical methods like the Newton-Raphson method. In this case, I'll use trial and error to find an approximate solution:
Let's start by assuming a discount rate of 5%:
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1 + 0.05)^{-19}}}{{0.05}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1.05)^{-19}}}{{0.05}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - 0.37689}}{{0.05}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{0.62311}}{{0.05}} \][/tex]
[tex]\[ 9,968,843 \approx 18,381,895 \][/tex]
The result is significantly greater than $9,968,843, indicating that the assumed discount rate of 5% is too low. Let's try a higher rate:
Let's try a discount rate of 10%:
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1 + 0.10)^{-19}}}{{0.10}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1.10)^{-19}}}{{0.10}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - 0.02830}}{{0.10}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{0.97170}}{{0.10}} \][/tex]
[tex]\[ 9,968,843 \approx 14,660,976 \][/tex]
The result is still lower than $9,968,843, indicating that the assumed discount rate of 10% is too high. Let's try an intermediate rate:
Let's try a discount rate of 7.5%:
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1 + 0.075)^{-19}}}{{0.075}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - (1.075)^{-19}}}{{0.075}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{1 - 0.31863}}{{0.075}} \][/tex]
[tex]\[ 9,968,843 = 1,521,875 \times \frac{{0.68137}}{{0.075}} \][/tex]
[tex]\[ 9,968,843 \approx 9,968,843 \][/tex]
The result is approximately $9,968,843, indicating that the assumed discount rate of 7.5% is close to the actual discount rate used by the potential buyer.
So, the discount rate used by the potential buyer is approximately 7.5%.
which of the following statements is true? Short-term bonds have greater interest rate risk than do long-term bonds. Long-term bonds have greater interest rate risk than do short-term bonds. All bonds have equal interest rate risk. Interest rate risk is highest during periods of high interest rates.
Answer:
Short-term bonds have greater interest rate risk than do long-term bonds.
Explanation:Short-term bonds are bonds whose period before maturing is short,it will mature between one to four years,the shorter the term of the bond the lesser the risk. High risk is expected for long term bonds especially for an inconsistent economy. Most investors are very interested in short term bonds because they usually mature in short term,they can take back their money and reinvest helping to increase their total revenue on the long term.
Long-term bonds have a higher interest rate risk than do short-term bonds because they have more time until maturity and are therefore more affected by changes in interest rates.
Explanation:The correct statement is: 'Long-term bonds have greater interest rate risk than do short-term bonds'. Interest rate risk refers to the potential for investment losses that result from a change in interest rates. If interest rates rise, the price of a bond will decrease. This is because the bond's fixed interest payments are less attractive compared to the higher interest payments offered on new bonds. Long-term bonds are more affected by interest rate changes because they have a longer time until maturity. Hence, the interest rate risk of long-term bonds is higher than that of short-term bonds.
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An automobile manufacturer having 7 assembly plants and hundreds of dealers throughout the United States can find the guaranteed optimal transportation plan (assuming linear transportation costs and known demands and capacities) by using :_______
Answer:
An automobile manufacturer having 7 assembly plants and hundreds of dealers throughout the United States can find the guaranteed optimal transportation plan (assuming linear transportation costs and known demands and capacities) by using either linear programming model or transportation model.
Explanation:
Linear programming addresses issues such as profit maximization, cost minimization or maintaining that we make the greatest use of existing resources. From an implementation perspective, linear programming is an optimization tool that permits many administrative and/or technological decisions to be interpreted.
Throughout World War II the seeds of linear programming were sown when it was necessary to quickly transfer the military supplies and staff. While the transport model discusses the principle of unchanged transferring an item from one position to another. This implies that any disruption on the way has negative effects, and so it is used to evaluate transport networks and seek the most efficient method to allocating resources.
Suppose that XTel currently is selling at $40 per share. You buy 500 shares using $15,000 of your own money, borrowing the remainder of the purchase price from your broker. The rate on the margin loan is 8%. a. What is the percentage increase in the net worth of your brokerage account if the price of XTel immediately changes to (a) $44; (b) $40; (c) $36
Answer:
Initial net worth = $40* 500= $20000
a) Net worth of brokerage account = 44 * 500 = $22000
Percentage increase in the net worth of your brokerage account=[22000-20000]/20000 * 100= 10%
b) Net worth of brokerage account = 40 * 500 = $20000
Percentage increase in the net worth of your brokerage account=[20000-20000]/20000 * 100= 0%
c)If XTel's price changes to $36, the net worth of the brokerage account can be calculated as follows:
Net worth of brokerage account = 36 * 500 = $18,000.
Percentage decrease in the net worth of your brokerage account=[18000-20000]/20000 * 100= -10%
Explanation:
If the quantity supplied responds only slightly to changes in price, thenA. supply is said to be elastic.B. even a large decrease in demand will change the equilibrium price only slightly.C. an increase in price will not shift the supply curve very much.D. supply is said to be inelastic.
Answer:
D. supply is said to be inelastic.
Explanation:
When the change in the quantity supplied of any good is less sensitive due to change in the price, then the supply is known as the inelastic and If the quantity supplied responds only slightly to changes in price, then supply is said to be inelastic.
A city engineer knows that she will need 25 million in 3 years to replace toll booths on a toll road in the city. Traffic on the road is estimated to be 20 million vehicles per year. How much per vehicle should the toll be to cover the cost of the toll booth replacement project? Interest is 10%. (Simplify your analysis by assuming that the toll receipts at the end of each year in a lump sum.)
Answer:
0.50 per vehicle
Explanation:
Given:
Number of years = 3
Number of vehicles per year = 20 million
Amount required = 25 million
Interest rate = 10% = 0.10
Therefore,
Cost of borrowing = Amount required × Interest rate
= 25 million × 0.1
= 2.5 million
Total Toll Booths Replacement Cost = Amount required + Cost of borrowing
= 25 million + 2.5 million
= 27.5 million.
Amount to Charge Per Year = Total Toll Booths Replacement Cost ÷ Number of Years
Lump Sum Amount to Charge Per Year = 27.5 million ÷ 3
= 9.17 million
Yearly toll per vehicle = Lump Sum Amount to Charge Per Year ÷ Number of Vehicles per year
Yearly toll per vehicle = 9.17 million ÷ 20 million
= 0.46 approximately 0.50
Therefore, the toll should be 0.50 per vehicle.
I wish you the best.
To cover the cost of the toll booth replacement project, the toll per vehicle should be approximately $0.9385.
Explanation:To calculate the toll per vehicle, we need to find the present value of the future cost of replacing the toll booths. Using the formula for present value, we can calculate the amount.
PV = FV / (1 + r)^n
Where PV is the present value, FV is the future value, r is the interest rate, and n is the number of years. Plugging in the values, we have:
PV = 25 million / (1 + 0.10)^3
PV = 25 million / 1.331
PV ≈ 18.77 million
Now, we divide the present value by the estimated number of vehicles per year to find the toll per vehicle:
Toll per vehicle ≈ 18.77 million / 20 million
Toll per vehicle ≈ $0.9385
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