The impact of a company diversifying as a way to reduce risk and protect against uncertain future cash flow from its core business "would be value-neutral". Option C is correct.
While diversification may reduce risk and protect against uncertain future cash flow, it may also require additional investment and may not generate the same returns as the core business. Therefore, the impact on the firm's overall value may be neutral, as any gains from diversification may be offset by the costs and potential decrease in profitability from the core business. Ultimately, the impact on the firm's value will depend on the success and effectiveness of the diversification strategy.
Learn more about value-neutral https://brainly.com/question/30225857
#SPJ11
In general, developers must get a construction loan before they can line up permanent (long-term) financing that will be used once the project is complete and being operated with tenants. (T/F)
In general, developers must get a construction loan before they can line up permanent (long-term) financing that will be used once the project is complete and operated with tenants. This statement is true.
What is a construction loan? A construction loan is a form of bank or another lender financing that assists in the construction of a new home or another type of real estate project. The lender will generally pay out the funds to the builder or contractor in tranches as the work progresses. When the work is completed, the loan is then repaid by the borrower via a new, more permanent loan that covers the property's entire value.
There are various forms of loans available in the market that can be used to finance your dream house; however, a construction loan is a special type of loan that is used for the construction of a new property. Once the project has been completed and the property has been occupied by tenants, the construction loan is replaced by a long-term, permanent financing arrangement that will cover the entire value of the property.
To learn more about “loans” refer to the https://brainly.com/question/20688650
#SPJ11
retail sales are measured by . a.) collecting self-reported data from all retail outlets with over 10 employees b.) the census bureau c.) collecting self-reported data from chains of over 40 stores d.) the bureau of labor statistics.
Retail sales are measured by collecting self-reported data from chains of over 40 stores. Option C is correct.
Retail sales is a measure of how much product consumers buy from stores. Retail sales in the United States are measured by the Census Bureau. Retail sales are monitored by the US Department of Commerce, which publishes retail sales estimates once a month.
The data are compiled by gathering self-reported data from chains of more than 40 stores. The Bureau of Labor Statistics, on the other hand, conducts the Current Employment Statistics (CES) survey to provide an early estimate of monthly nonfarm payroll employment data.
In conclusion, option c) collecting self-reported data from chains of over 40 stores is correct.
See more about retail sales at https://brainly.com/question/29559180.
#SPJ11
wang inc., an oil refinery, buys crude oil and converts it into various products such as gasoline, kerosene, and diesel. wang inc. then sells these products to other companies or retailers. based on this information, which segment of the business market is most likely represented by wang inc.?
Wang Inc. operates in the downstream segment of the oil and gas industry, which involves the refining and processing of crude oil into various petroleum products such as gasoline, diesel, and kerosene.
What is the downstream segment?The downstream segment also includes the marketing and distribution of these products to wholesalers, retailers, and end-users. Wang Inc. buys crude oil from upstream companies and converts it into valuable products, which it then sells to downstream customers.
Therefore, Wang Inc. is a part of the downstream market segment that includes refineries, marketing and distribution companies, and end-users.
Read more about business market here:4
https://brainly.com/question/25492268
#SPJ1
Suppose you have a money income of $10, all of which you spend on Coke and popcorn. n the above diagram, the prices of Coke and popcorn respectively are: A. $0.50 and $1.00. B. $1.00 and $0.50 C. $1.00 and $2.00. D. $0.40 and $0.50
The option that allows you to spend all $10 is where Coke costs $0.40 and popcorn costs $0.50.
What are spends?In financial terms, "spends" generally refers to the amount of money that is expended or spent on goods or services by an individual, organization, or government. It can also refer to the process of allocating funds for various purposes, such as marketing spends or capital spends. Spends can vary depending on a number of factors, including the individual's or organization's budget, the nature of the goods or services being purchased, and the prevailing economic conditions. For businesses, spends can be a critical factor in determining profitability and growth, as they must balance their spending with their revenue to ensure financial sustainability. Effective management of spends can involve budgeting, tracking expenses, negotiating with suppliers, and making strategic decisions about investments and expenditures.
If Coke costs $0.40 and popcorn costs $0.50, you could buy 25 Cokes ($0.40 x 25 = $10) or 20 popcorns ($0.50 x 20 = $10). Therefore, you could buy a combination of 25 Cokes and 0 popcorns, or 20 popcorns and 0 Cokes.
To learn more about spends, visit:
https://brainly.com/question/28875731
#SPJ1
the spot price of the market index is $900. a 3-month forward contract on this index is priced at $930. what is the profit or loss to a short position if the spot price of the market index rises to $920 by the expiration date? $20 gain $20 loss $10 gain $10 loss
The profit or loss to a short position is a $20 loss if the spot price of the market index rises to $920 by the expiration date.
The spot price of the market index is the current price of the market index. A 3-month forward contract on this index is an agreement to buy or sell the index at a specific price at some point in the future.
The spot price of $900 and the 3-month forward contract of $930 mean that the holder of the contract is obligated to sell the index for $930 even though the current spot price is only $900.
If the spot price rises to $920 by the expiration date, then the holder of the contract has to sell the index at the agreed upon price of $930, even though the current spot price is $920. Therefore, the holder would lose $20 because they are selling at a lower price than what the market index is worth.
To know more about spot price click on below link:
https://brainly.com/question/17055829#
#SPJ11
an extended car warranty or vehicle service contract could protect you against surprise car bills. but that piece of mind could come at a steep __________ if you wind up paying for identical coverage that came free with your manufacturer warranty.
An extended car warranty or vehicle service contract can protect you against unexpected car bills, but it can come at a steep cost if you wind up paying for coverage that was already included in the manufacturer warranty.
This is because many of the services and components that are covered by the extended warranty may already be included in the original manufacturer's warranty. Before signing up for an extended warranty, it is important to make sure you understand what is and isn't included in the original manufacturer's warranty, as well as any differences in the coverage and cost of the extended warranty. Additionally, it is also important to consider whether the services offered by the extended warranty are ones that you would actually use. Doing this research ahead of time can help save you from buying unnecessary coverage and paying a higher price than necessary.
For more such questions on warranty
https://brainly.com/question/14227081
#SPJ11
imani is 45 years old. she recently met with her financial planner to review her contributions to her roth ira, a retirement account. the financial planner also mentioned to imani that she should consider purchasing long-term care insurance since a high proportion of consumers will likely spend one to two years in a nursing home or assisted living space before the end of their lives. the financial planner said that premiums usually increase after age 50, and that there were several good plans imani should consider. imani was somewhat familiar with the term long-term care insurance, but she had never thought about purchasing the product. thus, for imani, long-term care insurance would be a(n)____product.
Imani had never considered purchasing long-term care insurance before meeting with her financial planner. Thus, for Imani, long-term care insurance would be a new product.
What is long-term care insurance? Long-term care insurance provides coverage to individuals who require assistance with everyday tasks like bathing, dressing, and eating due to chronic illness or disability. Long-term care insurance policies typically pay for care at home, in a nursing home, or in an assisted living facility.
What is a proportion? A proportion is a ratio that expresses how two quantities are related. It can be expressed in a variety of ways, such as in fractions, decimals, or percentages.
What is a financial planner? A financial planner is a professional who assists clients in developing strategies to achieve their financial goals. Financial planners can provide guidance on a variety of financial issues, such as retirement planning, investment management, tax planning, and estate planning.
To learn more about “financial planners” refer to the https://brainly.com/question/989344
#SPJ11
which of the following people would not be considered part of the labor force? select the correct answer below: a. lane is working in his first job after high school at a fast food restaurant.
b. peter lost his job in the recession and is unable to find a new job. c. cheng is unemployed and collecting unemployment benefits while searching for jobs.
d. joan was laid off from her job but has decided not to look for another job right now as she wants to stay home with her kids for a while.
The person that would not be considered part of the labor force is Joan who was laid off from her job but has decided not to look for another job right now as she wants to stay home with her kids for a while (Option d).
An individual who is laid off but has decided not to search for another job is not part of the labor force. Labor force refers to the number of individuals who are either working or are searching for employment. People who are retired, full-time students, and homemakers are not part of the labor force.
However, some individuals may be able to work but are not currently doing so, and they are referred to as "discouraged workers."
Therefore, these individuals are not part of the labor force even though they are able to work. In the above question, Lane and Cheng are actively looking for employment; therefore, they are part of the labor force. Peter is also willing to work but is currently unemployed; therefore, he is considered part of the labor force. Joan, on the other hand, has chosen not to search for a new job even though she was laid off. Thus, Joan is not part of the labor force.
To know more about labor force, visit: https://brainly.com/question/14328462
#SPJ11
what three tips on how to incorporate an influencer strategy at your next event by allen yesilevich?
Here are three tips on how to incorporate an influencer strategy at your next event:
Set clear goals: Before you begin identifying potential influencers, it's important to have a clear understanding of your event goals and what you hope to achieve through influencer marketing. Are you looking to increase event attendance, generate buzz on social media, or drive engagement with your target audience? Once you've defined your goals, you can better identify influencers who can help you achieve them.
Build authentic relationships: Influencer marketing is most effective when you build authentic relationships with influencers. Take the time to research potential influencers and their content, engage with them on social media, and provide value to them before you pitch a partnership. This can help establish a foundation of trust and ensure that the influencer's endorsement of your event is genuine.
Provide value to your influencers: To incentivize influencers to promote your event, consider offering them value in exchange for their participation. This could include free event tickets, exclusive access to speakers or VIP areas, or compensation for their time and effort. By providing value to your influencers, you can build stronger relationships and ensure that they are motivated to promote your event to their audience.
Incorporating an influencer strategy at your next event can help you reach a wider audience and generate excitement around your event. By setting clear goals, building authentic relationships, and providing value to your influencers, you can create a successful influencer marketing campaign that drives results.
Learn more about marketing here brainly.com/question/15483550
#SPJ4
Business level strategy addresses two related issues: what businesses should a corporation compete in and how can these businesses be managed so that they create synergy. True or False
It is true that the Business level strategy addresses two related issues: what businesses should a corporation compete in and how can these businesses be managed so that they create synergy. The correct option is True.
What is a business-level strategy?
A business-level strategy is a process that an organization uses to determine how to compete in its particular market. A company's business-level strategy is typically expressed in its mission statement and strategic goals. It is the strategic approach that a company employs to gain a competitive advantage by utilizing its core competencies in a given industry or market sector.
What is the significance of the business-level strategy?
In any organization, the business-level strategy is critical. It aids in the decision-making process and aids in identifies the core competencies that provide the company with a competitive advantage. In addition, it serves as a roadmap for ensuring that the company achieves its strategic objectives.
Therefore the correct option is true.
Learn more about Strategy here:-
https://brainly.com/question/1417340
#SPJ11
the effects on organizations of unmotivated and unhappy workers include: multiple select question. improved product development poor relationships with customers high recruitment and training costs increased financial success
Unmotivated and dissatisfied employees have a negative impact on businesses in the form of costly training and recruitment expenses as well as bad customer relations.
What impact does a disengaged workforce have on a business?A demotivated employee can have an adverse effect not just on the productivity of the person but also on the team as a whole. Other employees may experience stress when attempting to pick up the slack as a result of increased tardiness or absenteeism at work as well as a lack of attention on routine chores.
What negative impact does a lack of motivation have on a company?Higher employee turnover, poorer engagement, poor communication, and decreased productivity are just a few of the problems that may develop and make your workplace a toxic environment.
To Know more about customer relations.
https://brainly.com/question/30204942
#SPJ1
______ shows the actual performance of ads in terms of awareness, costs efficiency, or sales and those that don't do well may be dropped.
A/B testing shows the actual performance of ads in terms of awareness, cost efficiency, or sales and those that don't do well may be dropped.
A/B testing can help you optimize your marketing efforts and get better results by allowing you to compare two different versions of a marketing element, such as an ad or landing page, against each other. A/B testing can be done on a variety of marketing elements, including email subject lines, landing pages, call-to-action buttons, and ad copy. A/B testing can help businesses increase their conversion rates by providing actionable insights into what works and what doesn't work in their marketing efforts. It can help businesses identify the elements that are most effective at driving conversions, and it can help them optimize those elements to get even better results.
In conclusion, A/B testing shows the actual performance of ads in terms of awareness, cost efficiency, or sales and those that don't do well may be dropped. A/B testing can help businesses optimize their marketing efforts and get better results by providing actionable insights into what works and what doesn't work in their marketing efforts.
Learn more about A/B testing here: https://brainly.com/question/14957436
#SPJ11
who developed a growth model that suggests new products unleash a gale of creative destruction that drives old products out of the market?
Joseph Schumpeter developed a growth model that suggests new products unleash a gale of creative destruction that drives old products out of the market.
The idea of creative destruction was created by Austrian economist Joseph Schumpeter and was outlined in his growth model. He thought that when new goods and technology are introduced into a market, a disruptive force is created that displaces older, less effective products and processes, causing the demise of established industries and the emergence of new ones. Schumpeter contends that in capitalist society, this dynamic is what spurs innovation, expansion, and progress. The whirlwind of creative destruction refers to the continual economic turnover of items and processes that happens in market economies. This idea emphasises how crucial innovation and entrepreneurship are to advancing the economy and explains why some businesses succeed while others go out of business.
learn more about Joseph Schumpeter here:
https://brainly.com/question/30077234
#SPJ4
ms. beal recognized a $42,400 net long-term capital gain and a $33,000 net short-term capital loss this year. what is her current net income tax cost from her capital transactions if her marginal rate on ordinary income is 37%?
According to the question, the current net income tax cost from Beal's capital transactions is $9,100.
What is net income?Net income is a financial metric that is used to measure the profitability of a business after all expenses have been deducted from the gross income. It is calculated by subtracting the cost of goods sold (COGS), operating costs, taxes, and any other expenses from the total revenue. Net income is also known as net profit, bottom line, or net earnings.
This is calculated by taking her net long-term capital gain of $42,400 and multiplying it by the marginal rate of 37%, which is $15,688. We then take the net short-term capital loss of $33,000 and subtract it from the $15,688, which leaves us with a net tax cost of $9,100.
To learn more about net income
https://brainly.com/question/30403491
#SPJ1
whtat the edfinition of price takers?
Price takers are businesses or people that operate in completely competitive markets but lack the ability to command a higher price for their goods or services.
People or businesses who operate in a market and have no control over the price of the goods or services they sell are known as price takers. Individuals are powerless to influence the market price through their own actions or decisions, and must accept the price set by supply and demand factors. In other words, they are powerless to control the price and are forced to accept whatever the market decides. Price takers often work in markets that are very competitive, have a large number of customers and sellers, uniform products, and no obstacles to entering or departing.
learn more about Price takers here:
https://brainly.com/question/29218058
#SPJ4
xyz is an annual bond that pays a coupon rate of 4%. what payment would you expect to receive every year?
If xyz is an annual bond that pays a coupon rate of 4%, the payment that you would expect to receive every year would depend on the: face value of the bond.
The face value is the amount that the bondholder will receive upon maturity.
To calculate the annual payment, you would need to multiply the face value of the bond by the coupon rate. This would give you the annual interest payment that the bondholder would receive.
The formula to calculate the annual payment is:
Annual payment = Face value x Coupon rate
For example, if the face value of the bond is $1000, and the coupon rate is 4%,
the annual payment would be:
Annual payment = $1000 x 0.04
Annual payment = $40
Therefore, you would expect to receive $40 every year as the payment for the bond.
To know more about bond, refer here:
https://brainly.com/question/29455521#
#SPJ11
after you submit your budget, who addresses decisions about purchasing equipment and supplies, cost accounting, and maintaining the facilities for storing the equipment and supplies?
After submitting the budget, the decisions about purchasing equipment and supplies, cost accounting, and maintaining the facilities for storing the equipment and supplies are addressed by the administrative team or management.
BudgetIt is their responsibility to ensure that the budget is followed and that the equipment and supplies needed for the organization are purchased appropriately. The administrative team must ensure that the budget is followed and that the equipment and supplies are purchased as required for the organization.
Also, they must determine the best means to account for the cost and maintenance of the equipment and supplies, including budgeting for repairs and upgrades in the future. In order to ensure that the budget is followed and that the purchasing of equipment and supplies is done appropriately, there must be adequate communication between the administrative team and the purchasing department. T
Learn more about budget here:
brainly.com/question/15683430
#SPJ11
In working with Schedule M-2 (analysis of unappropriated retained earnings per books) of Form 1120, which of the following is an addition to beginning retained earnings?a. Cash dividends.b. None of the above.c. Net income per books.d. Property dividends.e. Net loss per books.
The correct answer is C Net income per book. In working with Schedule M-2 of Form 1120, an addition to beginning retained earnings is the Net income per book.
Schedule M-2 is a supplemental schedule that reports information regarding the corporation's accumulated earnings and profits (E&P) balance.
This schedule is only required if the corporation had E&P at the end of the year, and it is completed as a continuation of the corporation's balance sheet, which is part of Form 1120.
The purpose of this schedule is to explain the difference between the corporation's beginning and ending retained earnings reported on its balance sheet.
If the difference between beginning and ending retained earnings is the same as the corporation's E&P balance, then Schedule M-2 will reconcile the difference.
When it comes to working with Schedule M-2 of Form 1120, Net income per book is an addition to beginning retained earnings.
Hence, option c is the correct answer.
Learn more about net income here
https://brainly.com/question/28390284
#SPJ11
T/F: business analytics can be used only for forecasting future business results.
False, business analytics can be used for much more than just forecasting future business results.
Business analytics is a set of techniques and tools used to analyze data and provide insights into various aspects of a business. It can be used to answer a wide range of business questions and support decision-making at all levels of an organization.Business analytics can be used to:1. Identify trends and patterns in data2. Measure and monitor key performance indicators (KPIs)3. Forecast future performance based on historical data4. Evaluate the impact of business decisions5. Optimize business processes6. Identify opportunities for growth and expansion7. Improve customer experience and satisfaction8. Analyze competitors and market trends9. Reduce costs and increase efficiency10. Monitor and manage riskIn short, business analytics can be used to provide a comprehensive view of a business, helping organizations to make informed decisions, improve performance, and achieve their goals. It is a powerful tool that can be used in almost any area of a business, from marketing and sales to operations and finance. By using data to gain insights into business operations, organizations can gain a competitive advantage, improve customer satisfaction, and achieve their business objectives.
For more such questions on business
https://brainly.com/question/24553900
#SPJ11
which statement about apprenticeships is true?multiple choice
a. an apprenticeship does not include any classroom training methods.
b. an apprenticeship cannot be sponsored by groups outside the firm.
c. an apprenticeship is mostly used for teaching management and interpersonal skills.
d. an apprentice can earn an income while learning a trade.
e. an apprenticeship does not offer hands-on learning and practice.
The statement about apprenticeships that is true is that an apprentice can earn an income while learning a trade. This statement is true because apprenticeships are on-the-job training programs that allow individuals to learn a specific trade or craft while working under the supervision of a skilled professional.
Apprenticeships are offered in a variety of fields, including construction, manufacturing, healthcare, and transportation.
During an apprenticeship, apprentices receive a combination of classroom instruction and on-the-job training. The length of an apprenticeship program can vary depending on the field and the complexity of the skills being taught. Apprenticeships can last anywhere from one to six years.
Apprentices are paid for their work during the program. In addition to earning a paycheck, apprentices receive benefits such as health insurance and retirement benefits. Apprenticeship programs are often sponsored by employers, industry associations, and labor unions.
In conclusion, apprenticeships are a valuable way for individuals to learn a specific trade or craft while earning a paycheck. Apprenticeships offer a combination of classroom instruction and on-the-job training and can last anywhere from one to six years. Apprenticeship programs are often sponsored by employers, industry associations, and labor unions.
For more questions on apprenticeships
https://brainly.com/question/8807113
#SPJ11
suppose the real interest rate is 2.5% and expected inflation is 2% . what is the nominal interest rate?
The nominal interest rate is 4.5%.
The nominal interest rate is calculated by adding the real interest rate and expected inflation together.
In this case, the real interest rate is 2.5% and the expected inflation rate is 2%. Therefore, when added together, the nominal interest rate is 4.5%.
The nominal interest rate is the rate of interest before accounting for inflation. It is a rate used in financial transactions and reflects the borrowing and lending conditions of the economy.
The real interest rate, on the other hand, is the rate of interest after accounting for inflation. In other words, it is the rate that an investor can earn, minus the rate of inflation. Therefore, to calculate the nominal interest rate, the real interest rate and the expected inflation rate must be added together.
To know more about nominal interest rate click on below link:
https://brainly.com/question/13324776#
#SPJ11
An open-market purchase of government bonds accompanied by a decrease in income taxes will result in which of the following in the short run?
A. A decrease in real output
B. A decrease in the price level
C. A decrease in unemployment
D. A decrease in nominal wages
E. A decrease in the natural rate of unemployment
An open-market purchase of government bonds accompanied by a decrease in income taxes will result in a decrease in unemployment in the short run. Therefore, the correct answer is C.
The open-market purchase of government bonds is a monetary policy that increases the quantity of money in circulation by lowering interest rates. A decrease in interest rates reduces borrowing costs for businesses and individuals, resulting in increased consumption and investment, which stimulates aggregate demand and ultimately leads to an increase in employment and output.
The decrease in income taxes would lead to increased disposable income, resulting in increased consumer spending, leading to increased aggregate demand, and a further increase in output and employment. Therefore, the combination of open-market purchases and a decrease in income taxes will result in a short-term boost in output and employment.
Learn more about open-market purchase at https://brainly.com/question/13607104
#SPJ11
in explaining the importance of supply chain sustainability, bob taylor of taylor guitars explains that one of their perspectives when sourcing wood for their guitars: apples grow on trees and oranges grow on trees, but a. apples taste better than oranges b. guitar strings do not grow on trees c. oranges taste better than apples d. wood does not grow on a tree, so when you harvest wood, you are destroying the entire tree,. therefore, you must protect the forests in order to have a sustainable source for wood.
you must protect the forests to have a sustainable source of wood. The correct option is D.
Supply chain sustainability has gained increasing importance in recent years due to the effects of environmental degradation, which has led to climate change, and social issues such as the exploitation of laborers. Bob Taylor of Taylor Guitars explains that when sourcing wood for their guitars, they consider sustainability, which is important.
Sustainability is concerned with meeting the needs of the present without jeopardizing the ability of future generations to meet their own needs. This is achieved through sustainable management and development, which ensures that natural resources are not depleted faster than they can be replenished. Therefore, protecting forests is important for the sustainability of the guitar industry as it helps to maintain the balance of the ecosystem and the livelihoods of people who depend on the forests for their livelihoods.
Wood does not grow on a tree, so when you harvest wood, you are destroying the entire tree. Therefore, you must protect the forests to have a sustainable source of wood.
So, the correct answer is option D (Wood does not grow on a tree, so when you harvest wood, you are destroying the entire tree. Therefore, you must protect the forests to have a sustainable source for wood).
Learn more about Management here:-
https://brainly.com/question/1276995
#SPJ11
Beginning inventory, purchases, and sales for Item 88-HX are as follows:
July 1 Inventory 90 Units at $52
July 8 Sale 75 Units
July 15 Purchase 125 Units at $58
July 27 Sale 100 Units
Assuming a perpetual inventory system and using the last-in, first-out (LIFO) method, determine (a) the cost of goods sold on July 27 and (b) the inventory on July 31.
On July 27, the cost of the goods sold was $8,550. On July 31, the stock was $6,130.
How are inventory purchases calculated?Calculating beginning inventory requires determining the cost of goods sold (COGS). The value of the most recent ending inventory should then be added, and the cost of fresh inventory acquisitions should be deducted. (COGS + ending inventory) - purchases is the equation.
Starting with the most recent purchase on July 15, we use 125 units to cover the first 125 units sold (75 on July 8 and 50 out of 125 on July 27).
The remaining 25 units sold on July 27 are assumed to come from the beginning inventory of 90 units.
Therefore, the cost of goods sold on July 27 is (125 units × $58 per unit) + (25 units × $52 per unit) = $7,250 + $1,300 = $8,550.
(90 units × $52 per unit) + (25 units × $58 per unit) = $4,680 + $1,450 = $6,130.
To know more about goods visit:-
https://brainly.com/question/29426090
#SPJ1
Both Bond Bill and Bond Ted have 12.4 percent coupons, make semiannual payments, and are priced at par value. Bond Bill has 5 years to maturity, whereas Bond Ted has 22 years to maturity. Requirement 1: If interest rates suddenly rise by 3 percent, what is the percentage change in the price of these bonds? (Do not round intermediate calculations. Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places (e.g., 32.16).) Percentage change in priceBond Bill %Bond Ted %Requirement 2: If rates were to suddenly fall by 3 percent instead, what would be the percentage change in the price of these bonds? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).) Percentage change in priceBond Bill %Bond Ted %
The percentage change in price will be 6.11% for Bond Bill and -35.22% for Bond Ted. The percentage change in price will be 14.67% for Bond Bill and 28.25% for Bond Ted.
Bond Bill and Bond Ted have 12.4 percent coupons, make semiannual payments, and are priced at par value. Bond Bill has 5 years to maturity, whereas Bond Ted has 22 years to maturity.
1: If interest rates suddenly rise by 3 percent, the percentage change in the price of these bonds are calculated below:
We are given the formula for calculating the price of a bond:
PV = PMT × [1 − 1 / {(1\ +\ r)}^n ] / r + FV / {(1\ +\ r)}^n
Where PV = price of bond, PMT = coupon payment, FV = maturity value, r = periodic interest rate, n = number of periods.
Bond Bill has 5 years to maturity, thus it has 5*2 = 10 periods. Bond Ted has 22 years to maturity, thus it has 22*2 = 44 periods.
If interest rates suddenly rise by 3 percent, then the new rate for Bond Bill will be 0.124 + 0.03 / 2 = 0.139 and for Bond Ted, it will be 0.124 + 0.03 / 2 = 0.139.
The new prices of Bond Bill and Bond Ted will be:
PV(Bond Bill) = 62 × [1 − 1 / {(1\ +\ 0.139)}^{10} ] / 0.0695 + 1000 / {(1\ +\ 0.139)}^{10}= $1,061.09
PV(Bond Ted) = 62 × [1 − 1 / {(1\ +\ 0.139)}^{44} ] / 0.0695 + 1000 / {(1\ +\ 0.139)}^{44}= $647.77
Then, the percentage change in the price of these bonds will be:
% Change = ((New Price - Old Price) / Old Price) x 100%
Change in price of Bond Bill = (($1,061.09 - $1,000)/$1,000) x 100% = 6.11%
Change in price of Bond Ted = (($647.77 - $1,000)/$1,000) x 100% = -35.22%
Thus, the percentage change in price will be 6.11% for Bond Bill and -35.22% for Bond Ted.
2. If rates were to suddenly fall by 3 percent instead, the percentage change in the price of these bonds is calculated below:
If rates were to suddenly fall by 3 percent, then the new rate for Bond Bill will be 0.124 - 0.03 / 2 = 0.109 and for Bond Ted, it will be 0.124 - 0.03 / 2 = 0.109.
The new prices of Bond Bill and Bond Ted will be:
PV(Bond Bill) = 62 × [1 − 1 / {(1\ +\ 0.109)}^{10} ] / 0.0545 + 1000 / {(1\ +\ 0.109)}^{10}= $1,146.67
PV(Bond Ted) = 62 × [1 − 1 / {(1\ +\ 0.109)}^{44} ] / 0.0545 + 1000 / {(1\ +\ 0.109)}^{44}= $1,282.52
Then, the percentage change in the price of these bonds will be:
% Change = ((New Price - Old Price) / Old Price) x 100%
Change in price of Bond Bill = (($1,146.67 - $1,000)/$1,000) x 100% = 14.67%
Change in price of Bond Ted = (($1,282.52 - $1,000)/$1,000) x 100% = 28.25%.
Learn more about Bond:
https://brainly.com/question/25965295
#SPJ11
using the monthly payment formula below, calculate the monthly payment for a 10-year $50,000 amortization loan at 4.5%.
The monthly payment for a 10-year $50,000 amortization loan at 4.5% is $479.93
Computation of monthly paymentCalculate the monthly interest rate:
Monthly Interest Rate = 4.5% / 12 = 0.375%
Calculate the number of payments:
Number of Payments = 10 years x 12 months/year = 120 payments
Calculate the monthly payment:
Monthly Payment = (50,000 * (0.375%)) / (1 - (1 + (0.375%))^(-120))
Monthly Payment = (50,000 * (0.00375)) / (1 - (1.00375)^(-120))
Monthly Payment = (50,000 * (0.00375)) / (1 - 0.2312)
Monthly Payment = (50,000 * (0.00375)) / 0.7688
Monthly Payment = $479.93
Learn more about monthly payment here:
https://brainly.com/question/28106777
#SPJ1
An investor has exchange-traded put options to sell 100 shares for $20. There is a 2-for-1 stock split. Which of the following is the position of the investor after the stock split?
A. Put options to sell 200 shares for $10
B. Put options to sell 100 shares for $10
C. Put options to sell 100 shares for $20
D. Put options to sell 200 shares for $20
B Put options to sell 100 shares for $10. After a 2-for-1 stock split, the investor’s put option to sell 100 shares for $20 is now worth the same as a put option to sell 200 shares for $10.
Put options are a sort of contract between an option's seller and the person who buys the option (the option holder).
This option gives the option holder the right, but not the obligation, to sell a predetermined number of shares of the underlying asset at a specific price (the strike price) by a certain date (the expiration date).
An investor has exchange-traded put options to sell 100 shares for $20. After the stock split, the investor will still have the put options but will have the right to sell 100 shares at a lower price.
So, the position of the investor after the stock split is that they will have put options to sell 100 shares for $10.
The price per share of the company has decreased as a result of the 2-for-1 stock split.
Therefore, the put option to sell 100 shares would have been adjusted to reflect the stock split.
So, the position of the investor after the stock split is that they will have put options to sell 100 shares for $10.The correct option is B. Put options to sell 100 shares for $10.
Learn more about exchange trade here:
https://brainly.com/question/28414303
#SPJ11
which of the accounts below are considered accrued expenses? multiple choice question. unearned revenue, utility expense cash, building, equipment wages expense, interest expense common stock, dividends
The accounts that are considered accrued expenses are wages expense and interest expense.
Accrued expenses are expenses that have been incurred but have not yet been paid. They are recorded in the accounting records as a current liability until the amount owed is paid. The following accounts are not accrued expenses: Unearned revenue is a liability account that represents income that has been collected but has not yet been earned. Utility expense, cash, building, equipment, common stock, and dividends are not accrued expenses as they do not represent expenses that have been incurred but not yet paid.
Wages expense and interest expense are both examples of accrued expenses. Interest expense is accrued when interest is charged on a loan, but the payment is not due until the end of the period. Similarly, wages expense is accrued when employees work but are not paid until the end of the pay period.
Learn more about liability at:
brainly.com/question/15006644
#SPJ11
one of the major predictions of the rothschild-stiglitz model is a positive correlation between risk and insurance coverage. this has never been observed in practice due to the confounding influence of moral hazard.
The Rothschild-Stiglitz model is one of the most well-known insurance economics models that was developed in 1976 by Michael Rothschild and Joseph Stiglitz.
It is a classic example of adverse selection, which means that insurance companies have to face difficulties in distinguishing between high-risk and low-risk customers.Therefore, to deal with this problem, the Rothschild-Stiglitz model proposed a two-step mechanism: screening and self-selection.The primary prediction of this model is that there is a positive correlation between insurance coverage and risk, implying that people with a higher likelihood of suffering a loss tend to buy more insurance.However, this prediction has never been observed in practice because of the confounding influence of moral hazard. Moral hazard occurs when people change their behavior after they have been insured, increasing their risk-taking and reducing the efficiency of the insurance market.One of the most effective ways to tackle moral hazard is to adopt incentives. Insurance companies may use deductibles, copayments, and coinsurance to align the interests of insurers and insured individuals. Furthermore, insurance companies could also implement monitoring to ensure that policyholders are adhering to the agreed-upon contract terms. Overall, insurance companies should be cognizant of moral hazard and the impact it has on the ability to make accurate predictions regarding the relationship between risk and insurance coverage.
for more questions on economics models
https://brainly.com/question/17548662
#SPJ11
fit for life foods reports the following income statement accounts for the year ended december 31 gain on sale of equipment 6320depreciation expense office copier 480office supplies expense760sales discounts15 700insurance expense1 370sales returns and allowances3 900sales217 000tv advertising expense2 200office salaries expense31 300interest revenue600rent expense selling space10 300cost of goods sold89 000sales salaries expense23 100sales commission expense13 000prepare a multiple step income statement
The Income Statement of Fit for Life Foods for the year ended December 31 is $22570.
The Income Statement of Fit for Life Foods for the year ended December 31 will be given as follows:
Sales 217000
Less: Sales returns and allowances 3900
Sales discounts 15700
Net Sales 199400
Cost of goods sold 89000
Gross Profit 110400
Operating Expenses: Office salaries expense 31300
Sales salaries expense 23100
Sales commission expense 13000
Rent expense selling space 10300
Depreciation expense office copier 480
TV Advertising expense 2200
Office Supplies expense 760
Insurance expense 1370
Total Operating Expenses 81110
Income from Operations 29300
Other Revenues and Gains:
Gain on sale of equipment 6320
Interest revenue 600
Total Other Revenues and Gains 6920
Other Expenses and Losses:
None Income before Income Tax 36220
Income Tax expense(-)13650
Net Income22570
Therefore, the multiple-step income statement of Fit for Life Foods for the year ended December 31, XXXX is prepared as above.
For more about income statement:
https://brainly.com/question/28035395
#SPJ11
