Answer:
a. 1 and 3.
Explanation:
Given that the operating leverage of a business firm is a sum of its fixed cost and variable cost about the way the firm's cost of business is attributed.
In this case, when a business firm has a high fixed cost, it normally requires a high number of sales to earn more profits. This is termed as "higher operating leverage." This thereby leads such business firms to have "increased risk."
Hence, It is practically correct that in business operation that when a business firm has Higher fixed costs it is associated with "higher operating leverage and increased risk"
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You own a portfolio equally invested in a risk-free asset and two stocks. If one of the stocks has a beta of 1.08 and the total portfolio is equally as risky as the market, what must the beta be for the other stock in your portfolio?
Answer: 0.92
Explanation:
Beta is a measure of riskiness and Market beta is always 1.
The total portfolio therefore has a beta of 1.
Portfolio Beta is weighted average of the betas of the composite stocks.
The stocks are equally invested in so their weights are 0.5.
Assume the beta needed is x.
(0.5 * 1.08) + (0.5 * x) = 1
0.54 + 0.5x = 1
0.5x = 1 - 0.54
x = 0.46/0.5
= 0.92
Briefly explain why the data Brainard cites indicate that the Phillips curve is relatively flat.
Answer:
C. The flatter the Phillips curve, the less the inflation rate will rise, and the inflation rate has not risen much.
Explanation:
The following information is
There is a decline in the unemployment rate from 8.2% to 4.4%
The main inflation would be undershot 2 percent for 58 months
Based on the above information
The reason behind the Phillips curve be flat is that the lower rate of inflation would increased also the rate of inflation would not increased much as it should be increased
Therefore the option C is to be selected
Recovery of Previously Written Off A/R
September 10-King pays the $200 previously
written off as uncollectible.
Prepare both journal entries.
Answer and Explanation:
The journal entries are shown below
On Sep 10
Account receivable - king $200
To Bad debt expense $200
(Being the reinstate previously written off account receivable is recorded)
Here account receivable is debited as it increased the assets and credited the bad debt expense as it decreased the expenses
On Sep 10
Cash Dr $200
To Account receivable - king $200
(Being cash collection is recorded)
Here the cash is debited as it increased the assets and account receivable is credited as it decreased the assets
Stock prices and stand-alone risk You invest $100,000 in 40 stocks, 20 bonds, and a certificate of deposit (CD). What kind of risk will you primarily be exposed to?
a. Portfolio risk
b. Stand-alone risk
Generally, investors would prefer to invest in assets that have: _________.
a. A high level of risk and low expected returns
b. A low level of risk and high expected returns
Answer and Explanation:
The risk that primarily be exposed is portfolio risk as the portfolio risk is the risk in which the risk is associated with the overall portfolio. On the other hand the stand alone risk is the risk that is associated with the single one only.
Since in the given situation, there is a different type of investment this represents that this is a portfolio risk
The investor always prefer for less level of risk and the high expected return in order to maximize the investment return with lesser risk level
In the formula FV=P(1+r)n, what is the n or period if the term is 10 years compounded yearly at 12% per annum?
10 b) 40 c) 120 d) 12
Answer:
a 10
Explanation:
The formula to compute the future value is shown below
Future value = Present value × (1 + rate of interest)^number of years
where,
The Rate of interest is 10%
And, the number of years or term is 10 years
Therefore as per the given situation, the correct option is a.
hence, the same is to be considered
Guerilla Radio Broadcasting has a project available with the following cash flows : Year Cash Flow 0 −$15,700 1 6,400 2 7,700 3 4,500 4 4,100 What is the payback period?
Answer: 2.36 years
Explanation:
Payback period is the amount of time it will take to pay off the initial investment/ outlay which in this case is $15,700.
= Year before investment is paid + (Amount remaining/ Cashflow in year of Payback)
Add up the cashflows to find the year before payback;
= 6,400 + 7,700
= $14,100
Year before payback = 2
Amount remaining;
= 15,700 - 14,100
= $1,600
Payback period = 2 + (1,600/ 4,500)
= 2.36 years
When the allowance method is used for bad debts, the entry to write off an individual account known to be uncollectible involves a
Answer:
debit to the Allowance account.
Explanation:
GAAP is an acronym for Generally Accepted Accounting Principles, it comprises of the accounting standard, procedures and principles used by public institutions in the United States of America. The U.S GAAP is issued by the Financial Accounting Standards Board (FASB) and adopted by the U.S. Securities and Exchange Commission (SEC).
IFRS is an acronym for International Financial Reporting Standards, it comprises of a set of accounting standards or rules issued by the International Accounting Standards Board (IASB). The International Financial Reporting Standards ensures that statement of income, when reported by accountants is consistent, transparent and comparable globally.
According to the Generally Accepted Accounting Principles (GAAP), when the allowance method is used for bad debts, the entry to write off an individual account known to be uncollectible involves a debit to the allowance account.
Exclusive distributorships are: a. covered under the Robinson-Patman Act. b. illegal per se. c. questioned when there is no interbrand competition. d. all of the above
Answer:
The correct option is c. EXCLUSIVE DISTRIBUTORSHIPS are questioned when there is no interbrand competition
Explanation:
The process in which a manufacturer of a goods or product decide and as well authorize that their would be only one distributor who will be the seller of their products or goods in a territory, a region or a Market is what is called EXCLUSIVE DISTRIBUTORSHIPS reason been that the manufacturer of such product want to know how good their products is in the territory and to get feedback from the customer about their products in order to take important action in a situation where their is lapses about their products.
Secondly in a situation where their is no INTERBRAND COMPETITION the EXCLUSIVE DISTRIBUTORSHIPS are been questioned reason been that INTERBRAND COMPETITION
occur when a manufacturer or producer of a products differentiate their products from other products that is sold in the same market where their products is been sold example of INTERBRAND COMPETITION is Mirinda drink versus Fanta
Therefore EXCLUSIVE DISTRIBUTORSHIPS are questioned when there is no interbrand competition.
Which statement best describes what a project manager controls?
the overall choice of which work becomes a project
the overall deadline when a project is due
the overall resources allocated for a project
the delegation of responsibilities in a project
Answer:
I believe it’s the delegation of resources
Explanation:only other logical choice is delegation of responsibilities but that’s up to the boss or who assigned the project in the first place
The statement that best describes what a project manager controls is the delegation of responsibilities in a project.
Who is a project manager?A project manager refers to the person who has the responsibility of planning and executing a project.
The delegation of responsibilities in a project is the best statement that describes what is controlled by the project manager.
Therefore, D is the correct option.
Learn more about the Project manager here:
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