If a bank receives a new transaction deposit of $10,000 and the reserve ratio is 5 percent, it means that the bank is required to hold a portion of that deposit as reserves, which is 5 percent or $500 in this case. The remaining $9,500 can be used to expand its loans.
This is because banks operate on a fractional reserve system, where they are allowed to lend out a portion of the deposits they receive, while keeping a fraction of it as reserves. The amount that the bank can expand its loans by is limited by the reserve ratio, which is set by the central bank. Therefore, the correct answer is (d) $9,500. It is important to note that this is a simplified explanation, as the actual process involves more complex calculations and regulations.
For more information on central bank. see:
https://brainly.com/question/28024310
#SPJ11
The bank could expand its loans by as much as: b. $10,000.
The reserve ratio is the percentage of deposits that banks are required to hold in reserves, meaning they cannot be used for loans. In this case, the bank's reserve requirement for the new deposit of $10,000 would be 5% of that amount, or $500. This means that the bank could potentially use the remaining $9,500 to make new loans, therefore expanding its lending by that amount.
If a bank receives a new transaction deposit of $10,000 and the reserve ratio is 5 percent, then the bank could expand its loans by as much as:
The reserve ratio is the percentage of deposits that a bank is required to hold in reserve and cannot lend out. In this case, the reserve ratio is 5%, so the bank must hold 5% of the $10,000 deposit as reserves, which is $500. The remaining $9,500 can be used to make loans, which means the bank can expand its loans by as much as $9,500.
Therefore, the correct answer is (b) $10,000, as the bank can lend out $9,500 and keep $500 as reserves to satisfy the reserve requirement.
To learn more about “reserve” refer to the https://brainly.com/question/25812353
#SPJ11
From the following data Total orders (Q) # of workers (L) # of machines (K) 8 1 1 13 1 2
18 1 3
21 2 3
26 2 4
Which is the correct corresponding production function? O Q = 8LK O Q=L+4K = L O Q = 3L +3K = O Q = 3L + 5K
The correct corresponding production function is Q = 3L + 5K.
Given the data for Total orders (Q), number of workers (L), and number of machines (K), we need to find the correct corresponding production function among the options provided:
1. Q = 8LK
2. Q = L + 4K
3. Q = 3L + 3K
4. Q = 3L + 5K
Let's test each option using the data given:
Option 1:
For the first data point (Q=8, L=1, K=1), the function would give Q = 8(1)(1) = 8, which is correct. However, for the second data point (Q=13, L=1, K=2), the function would give Q = 8(1)(2) = 16, which is incorrect.
Option 2:
For the first data point, the function would give Q = 1 + 4(1) = 5, which is incorrect.
Option 3:
For the first data point, the function would give Q = 3(1) + 3(1) = 6, which is incorrect.
Option 4:
For the first data point, the function would give Q = 3(1) + 5(1) = 8, which is correct. Let's check the second data point (Q=13, L=1, K=2). This function gives Q = 3(1) + 5(2) = 13, which is also correct. It also holds true for the rest of the data points.
So, the correct corresponding production function is Q = 3L + 5K.
To know more about corresponding production function, visit:
https://brainly.com/question/31519355#
#SPJ11
I told John I want a 30% ROI or better on the estimates or else the project is a no go. "Prove it to me in a business case John. Then we’ll run with your idea." The numbers are as follows:
Projected Benefits = $30 per product sold
Products Produced = 1,750
Products Sold = 1,400
Costs (Including everything) = $29,000
What is the ROI and is the project a go? Show all work.
The ROI is 41.38%, and the project is a go as it exceeds the 30% minimum requirement.
To calculate the ROI, we first need to calculate the total revenue generated from the sale of products. This can be found by multiplying the number of products sold (1,400) by the projected benefit per product ($30). Total revenue = 1,400 x $30 = $42,000.
Next, we can calculate the net profit by subtracting the total costs from the total revenue. Net profit = $42,000 - $29,000 = $13,000.
To calculate the ROI, we divide the net profit by the total costs and multiply by 100. ROI = ($13,000 / $29,000) x 100 = 41.38%.
Since the ROI is higher than the minimum requirement of 30%, the project is a go.
For more questions like Costs click the link below:
https://brainly.com/question/31041508
#SPJ11
Assume that you manage a risky portfolio with an expected rate of return of 13% and a standard deviation of 45%. The T-bill rate is 6%. Your client chooses to invest 75% of a portfolio in your fund and 25% in a T-bill money market fund. What is the expected return and standard deviation of your client's portfolio?
The expected return of the client's portfolio is 11%, and the standard deviation of the portfolio is 33.75%.
To calculate the expected return of the client's portfolio, we use the following formula:
Expected Return = (Weight of Portfolio in Fund x Expected Return of Fund) + (Weight of Portfolio in T-bills x T-bill Rate)
Substituting the values, we get:
Expected Return = (0.75 x 0.13) + (0.25 x 0.06) = 0.0975 or 9.75%
To calculate the standard deviation of the client's portfolio, we use the following formula:
Standard Deviation of Portfolio = Square Root of [(Weight of Portfolio in Fund x Standard Deviation of Fund)² + (Weight of Portfolio in T-bills x 0)² + (2 x Weight of Portfolio in Fund x Weight of Portfolio in T-bills x Correlation x Standard Deviation of Fund x 0)]
Since T-bills have a standard deviation of 0, we can simplify the formula:
Standard Deviation of Portfolio = Square Root of [(Weight of Portfolio in Fund x Standard Deviation of Fund)²]
Substituting the values, we get:
Standard Deviation of Portfolio = Square Root of [(0.75 x 0.45)²] = 0.3375 or 33.75%
To know more about standard deviation, refer here:
https://brainly.com/question/23907081#
#SPJ11
the exchange of one bond for a bond that has similar attributes but is more attractively priced is called .
The exchange of one bond for a bond that has similar attributes but is more attractively priced is called a bond swap. A bond swap is a common strategy used by investors to manage their bond portfolios and optimize their returns.
When interest rates change, the prices of bonds can fluctuate, and sometimes a bond that was once attractively priced may become less attractive. In a bond swap, an investor sells a bond that has become less attractive and uses the proceeds to purchase a bond that has similar attributes but is more attractively priced.
For example, if an investor holds a bond that pays a fixed interest rate of 4%, but interest rates have increased, causing new bonds to be issued with a higher interest rate of 5%, the original bond may become less attractive to investors. In this case, the investor could sell the original bond and use the proceeds to purchase a new bond with a higher interest rate of 5%. This would allow the investor to earn a higher return on their investment.
Bond swaps can be beneficial for investors because they allow them to improve the quality and performance of their bond portfolios without having to make a significant investment of new funds. Additionally, bond swaps can be used to manage risk by diversifying the types of bonds held in a portfolio. Overall, bond swaps are a useful tool for investors to optimize their bond holdings and manage their risk exposure.
Click the below link, to learn more about Bond:
https://brainly.com/question/17405470
#SPJ11
True or False? location factors related to the costs of factors of production inside a plant such as labor and capital.
True. Location factors can affect the costs of factors of production such as labor and capital inside a plant.
For example, if a plant is located in an area with high labor costs, it may increase the cost of production. Similarly, if the plant is located in an area with high capital costs, it may increase the cost of investing in equipment and machinery.
The statement is True. Location factors related to the costs of factors of production inside a plant, such as labor and capital, do influence the overall cost of production and are considered when choosing a suitable location for a plant. These factors may include labor wages, availability of skilled workforce, and capital investment requirements.
Learn more about labor here:
https://brainly.com/question/14348614
#SPJ11
Location factors can affect the costs of factors of production such as labor and capital inside a plant.True.
For example, if a plant is located in an area with high labor costs, it may increase the cost of production. Similarly, if the plant is located in an area with high capital costs, it may increase the cost of investing in equipment and machinery.
The statement is True. Location factors related to the costs of factors of production inside a plant, such as labor and capital, do influence the overall cost of production and are considered when choosing a suitable location for a plant. These factors may include labor wages, availability of skilled workforce, and capital investment requirements.
Learn more about labor here:
brainly.com/question/14348614
#SPJ4
Four years ago Jensen Inc. had purchased an equipment for $1o0,000. This equipment was being depreciated on a straight line basis over a 10 year period to a salvage value of $100,000. The equipment has six more years of economic life, and during this period the annual revenues and operating costs associated with this machine are expected to be $650,000 and $300,000, respectively Jensen is now considering replacing this machine with a less expensive and more efficient one, The old equipment can be sold for 1,000,000. Investment in net working capital is expected to increase by $150,000 as a result of the investment. The new machine will cost $1,400,000 and another $250,000/ will be needed to modify it. This machine falls into the ACRS 5-year class and will be depreciated under the modified ACRS method. It is also expected to have an economic life of 6 years. The annual revenue and operating( costs from the new machine are expected to be $900, 000 and $350, 000 respectively. At the sixth year Jansen expects to sell the net machine for $500,000. Jensen's marginal tax rate is 34%. a) calculate Jensen's Net Investment if the old machine is replaced with the new one. b) calculate Jensen's net cash flow for the next six years if the replacement decision is made.
a) Jensen's net investment after considering the proceeds from the sale of the old machine and the increase in net working capital will be $800,000.
b) Jensen's net cash flow for the next six years, if the replacement decision is made, would be $925,965.88.
a)How to calculate net investment?To calculate Jensen's net investment, we need to consider the initial cost of the new machine, the cost of modifications, the change in net working capital, and the proceeds from selling the old machine.
Net Investment = Cost of New Machine + Modification Cost + Change in Net Working Capital - Proceeds from Sale of Old Machine
Net Investment = $1,400,000 + $250,000 + $150,000 - $1,000,000
Net Investment = $800,000
Therefore, Jensen's net investment in the new machine would be $800,000 if they decide to replace the old machine with the new one.
b) How to calculate net cash flow?Jensen's net cash flow for the next six years if the replacement decision is made can be calculated as follows:
Year 1:
Revenue: $900,000
Operating Cost: $350,000
Depreciation Expense: $416,000 (modified ACRS method)
Taxable Income: $134,000
Taxes (34%): $45,560
Net Cash Flow: $418,440 ($900,000 - $350,000 - $416,000 - $45,560)
Year 2:
Revenue: $900,000
Operating Cost: $350,000
Depreciation Expense: $332,800
Taxable Income: $217,200
Taxes (34%): $73,848
Net Cash Flow: $398,352 ($900,000 - $350,000 - $332,800 - $73,848)
Year 3:
Revenue: $900,000
Operating Cost: $350,000
Depreciation Expense: $266,240
Taxable Income: $283,760
Taxes (34%): $96,522.40
Net Cash Flow: $390,237.60 ($900,000 - $350,000 - $266,240 - $96,522.40)
Year 4:
Revenue: $900,000
Operating Cost: $350,000
Depreciation Expense: $213,248
Taxable Income: $336,752
Taxes (34%): $114,590.08
Net Cash Flow: $399,659.92 ($900,000 - $350,000 - $213,248 - $114,590.08)
Year 5:
Revenue: $900,000
Operating Cost: $350,000
Depreciation Expense: $170,598.40
Taxable Income: $379,401.60
Taxes (34%): $129,186.62
Net Cash Flow: $420,414.98 ($900,000 - $350,000 - $170,598.40 - $129,186.62)
Year 6:
Revenue: $900,000
Operating Cost: $350,000
Depreciation Expense: $68,239.36
Gain on Sale of Machine: $500,000 - Book Value of Machine($0) = $500,000
Taxable Income: $1,081,760.64
Taxes (34%): $367,040.22
Net Cash Flow: $715,760.38 ($900,000 - $350,000 - $68,239.36 + $500,000 - $367,040.22)
Therefore, Jensen's net cash flow for the next six years if the replacement decision is made would be $925,965.88.
Learn more about cash flows
brainly.com/question/30736595
#SPJ11
Braddy Cellular purchases an Android phone for $452 less trade discounts of 20% and 5%. Braddy's overhead expenses are $20 per unit. a) What should be the selling price to generate a profit of $20 per phone? Selling Price = $ 0.00 b) What is the markup on cost percentage at this price? Markup on Cost = 0.00% c) What is the markup on selling price percentage at this price? Markup on Selling = 0.00 % d) What would be the break-even price for a clear-out sale in preparation for the launch of a new model? Break-Even = $ 0.00
a) The selling price to generate a profit of $20 per phone would be $557.20.
b) The markup on cost percentage at this price would be 23.1%.
c) The markup on selling price percentage at this price would be 18.8%.
d) The break-even price for a clear-out sale in preparation for the launch of a new model would depend on the total fixed and variable costs of the company. To calculate the break-even price, we need to determine the total cost per unit (including overhead expenses) and then add a desired profit margin.
If the break-even price is less than the current selling price, the company may consider a clear-out sale.
To calculate the selling price, we first need to determine the net cost of the phone after the trade discounts.
Net cost = $452 - ($452 * 0.20) - (($452 - ($452 * 0.20)) * 0.05) = $345.96
Selling price = Net cost + desired profit per unit = $345.96 + $20 = $557.20
The markup on cost percentage can be calculated as:
Markup on Cost = (Selling Price - Cost) / Cost * 100%
Markup on Cost = ($557.20 - $452) / $452 * 100% = 23.1%
The markup on selling price percentage can be calculated as:
Markup on Selling = (Selling Price - Cost) / Selling Price * 100%
Markup on Selling = ($557.20 - $452) / $557.20 * 100% = 18.8%
For more questions like Price click the link below:
https://brainly.com/question/19091385
#SPJ11
The current price of a 10-year, $1000 par value bond is $823.15. Interest on this bond is paid unnvanly, and Hts annual yield to maturity as 12 percent. Given these facts, What is the annual coupon payment on this bond? a. $ 60.00 b.$ 82.31 C.$ 120.00 d. $ 98.78 e $100.00 f. $ 88,70 Solvay Corporation bonds have a 20-year maturity, a 12% semiannual Coupon, and a par Valik of $11000. The current market rate is 9% based on semiannual compounding. What is the bond price? a. $1,271.81 b. $1,273.86c. $1,268.40 d. & 1, 241,82e. $ 1,276.02 f. $1,244.33
To calculate the annual coupon payment on the given bond, we need to first find the bond's coupon rate. We know that the bond has a 10-year maturity and a par value of $1,000. We also know that the bond is currently priced at $823.15 and has an annual yield to maturity of 12%.
Using a financial calculator or spreadsheet, we can find that the bond's coupon rate is 7.88%.
Annual coupon payment = Coupon rate x Par value
Annual coupon payment = 0.0788 x $1,000
Annual coupon payment = $78.80
Therefore," the annual coupon payment on this bond is $78.80."
For the second question, to calculate the bond price of the Solvay Corporation bond, we need to use the bond pricing formula:
Bond price = (Coupon payment / (1 + r)^1) + (Coupon payment / (1 + r)^2) + ... + (Coupon payment + Par value / (1 + r)^n)
where:
Coupon payment = semiannual coupon payment
r = market rate / 2 (semiannual market rate)
n = number of semiannual periods (20 years * 2 = 40 semiannual periods)
Plugging in the given values, we get:
Bond price = ($660 / 1.045^1) + ($660 / 1.045^2) + ... + ($660 + $11,000 / 1.045^40)
Bond price = $1,273.86
Therefore, "the bond price of the Solvay Corporation bond is $1,273.86. The closest option is (b)."
To know more about annual coupon paymentrefer here
https://brainly.com/question/29653354#
#SPJ11
which of the following costs is deductible as an itemized medical expense?multiple choicethe cost of prescription medicine and over-the-counter drugs.medical expenses incurred to prevent disease.the cost of elective cosmetic surgery.medical expenses reimbursed by health insurance.none of the costs are deductible.
The price of prescription medicine, over-the-counter medications, and medical costs used to prevent illness are all tax-deductible as itemized medical expenses.
However, the price of elective cosmetic surgery is not deductible, and neither are medical expenses covered by health insurance. If medical expenses are more than a particular percentage of your adjusted gross income (AGI), you may be able to write them off on your tax return.
However, some medical expenses are not tax deductible. Except in cases when it is required to treat a medical issue, the cost of elective cosmetic surgery is not deductible. Furthermore, healthcare costs that are paid for by insurance are typically not deductible.
To know more about deductible cost refer to:
brainly.com/question/30189608
#SPJ4
A 4-year project with an initial cost of $119,000 and a required rate of return of 17 percent has a chance of success of 9 percent. If the project succeeds, the annual cash flow will be $1,591,000. If the project fails, the annual cash flow will be −$214,000. The project can be shut down after the first two years, but all money invested will be lost. None of the initial cost can be recouped after four years. What is the net present value of this project at Time 0?
Answer:
The net present value of the project at Time 0 is $83,062.72. This means that the project is expected to generate a positive return, and it is worth investing in.
Explanation:
To calculate the net present value (NPV) of the project at Time 0, we need to find the present value of all cash flows associated with the project using the required rate of return of 17 percent.
First, let's calculate the expected cash flows for the project:
Chance of success = 9%
Chance of failure = 91% (100% - 9%)
If the project succeeds, the annual cash flow will be $1,591,000, and it will continue for four years. Therefore, the total cash flow for the project's life will be:
Total cash flow if the project succeeds = $1,591,000 x 4 = $6,364,000
If the project fails, the annual cash flow will be -$214,000, and it will also continue for four years. Therefore, the total cash flow for the project's life will be:
Total cash flow if the project fails = -$214,000 x 4 = -$856,000
Now, we can calculate the expected value of the project's cash flows:
Expected value = (Chance of success x Total cash flow if the project succeeds) + (Chance of failure x Total cash flow if the project fails)
Expected value = (0.09 x $6,364,000) + (0.91 x -$856,000) = $415,320
This means that the expected value of the project's cash flows is $415,320.
Next, we can calculate the NPV of the project at Time 0:
NPV = -Initial cost + PV of expected cash flows
NPV = -$119,000 + (PV factor for 4 years at 17% x $415,320)
NPV = -$119,000 + (0.486 x $415,320)
NPV = -$119,000 + $202,062.72
NPV = $83,062.72
For more such questions on present value , click on:
https://brainly.com/question/20813161
#SPJ11
sponsorship agreements within the sport industry commonly refer to the team, event, or sport organization as the . a. intermediary b. brand c. property d. agency
Sponsorship agreements within the sports industry commonly refer to the team, event, or sports organization as the property. Hence, Option (C) is correct.
The term "property" refers to the rights and assets associated with a particular entity or organization. In the case of sponsorship, the team, event, or organization possesses certain rights and assets that are attractive to potential sponsors.
These rights and assets may include branding opportunities, media exposure, access to a specific target audience, and other benefits that sponsors seek in order to enhance their own brand image and reach.
Thus, sponsors enter into agreements with the property, providing financial support in exchange for the rights and benefits associated with the sponsorship.
Learn more about sponsorship here:
https://brainly.com/question/15217613
#SPJ12
abc company has the following authorized stock: common stock: 1.00 par value, 100,000 shares on 1/11/15, abc company issued 10,000 shares of common stock for $5 per share (cash). the credit to additional paid in capital would be 40,000. group of answer choices true false
The given statement "The abc company has the following authorized stock: common stock: 1.00 par value, 100,000 shares on 1/11/15, abc company issued 10,000 shares of common stock for $5 per share (cash). the credit to additional paid in capital would be 40,000." is true.
When a company issues stock, the amount received in excess of the par value is recorded as additional paid-in capital. In this case, ABC Company issued 10,000 shares of common stock with a par value of $1.00 per share for $5 per share in cash. The total amount received for the issuance of these shares is $50,000 (10,000 shares x $5 per share).
The par value of the shares issued is $10,000 (10,000 shares x $1.00 par value per share). Therefore, the additional paid-in capital is calculated by subtracting the par value from the total amount received:
$50,000 - $10,000 = $40,000
So, the credit to additional paid-in capital would be $40,000, as stated in the question. Therefore, the statement "the credit to additional paid in capital would be 40,000" is true.
For more such questions on company
https://brainly.com/question/24448358
#SPJ11
A constant growth stock's price increases 4% per year. The stock is selling for $167 and has an investor required return of 11.6%.
How much will next year's dividend be? $________ (to two decimal places)
Next year's dividend after calculations will be $6.16
To find the next year's dividend, we need to first calculate the stock's dividend yield, which is the annual dividend payment divided by the stock's price. We can use the constant growth model to calculate the dividend yield:
Dividend Yield = (Next Year's Dividend / Stock Price) = (Dividend / (Investor Required Return - Dividend Growth Rate))
Solving for the dividend, we get:
Dividend = Dividend Yield x Stock Price x (Investor Required Return - Dividend Growth Rate)
Plugging in the given values, we get:
Dividend Yield = (Next Year's Dividend / $167) = Dividend / (11.6% - 4%) = Dividend / 7.6%
Rearranging, we get:
Next Year's Dividend = Dividend Yield x Stock Price x (Investor Required Return - Dividend Growth Rate) = 0.04 x $167 x (1 - 0.04/11.6) = $6.16
Therefore, next year's dividend will be $6.16 (to two decimal places).
To know more about dividend, visit:
https://brainly.com/question/29510262#
#SPJ11
Trip is confused that not all his health care honored by his care. Which can be covered by his managed can Annual contact lensecam X-ray for potential broken arm Cavity in his molar Annual teeth cleaning Trip is confused that not all his health-careclaims were honored by his managed-care plan. Which health-care expense would be covered by his managed-care plan? a. Annual contact lens exam b. X-ray for potential broken arm c. Cavity in his molar d. Annual teeth cleaning
The health-care expense would be covered by his managed-care plan are b. X-ray for potential broken arm and d. Annual teeth cleaning
Trip is confused that not all his health-care claims were honored by his managed-care plan. Typically, managed-care plans cover a range of essential health services, with certain limitations. In Trip's case, the health-care expenses that would most likely be covered by his managed-care plan are X-ray for potential broken arm, this is usually covered as it is a necessary diagnostic procedure for a potential injury and annual teeth cleaning - Most plans cover preventive dental care, which includes annual teeth cleaning to maintain oral health.
However, expenses like the annual contact lens exam and cavity treatment in his molar may not be covered, as they could be considered as specialized care or outside the scope of basic services provided by the managed-care plan. It's essential for Trip to review his plan's specific coverage to understand which services are included. The health-care expense would be covered by his managed-care plan are b. X-ray for potential broken arm and d. Annual teeth cleaning.
Learn more about health-care at:
https://brainly.com/question/30099278?
#SPJ11
which could constitute a second class of stock? group of answer choices treasury stock phantom stock. unexercised stock options. warrants. none of the above.
None of the above could constitute a second class of stock
Treasury inventory refers to shares of a agency's stock that have been repurchased by the corporation itself. It does not constitute a second class of stock.Phantom inventory is a kind of employee advantage that offers employees the blessings of proudly owning inventory with out absolutely giving them inventory ownership. It does not represent a second class of stock.Unexercised inventory options and warrants are each forms of economic contraptions that give the holder the option to buy stock at a certain rate. however, they do not represent a 2nd class of inventory.A 2nd class of inventory refers to a separate class of stocks with special vote casting rights or other attributes in comparison to the first magnificence of common stock. it is typically used to present sure shareholders more manipulate or rights in the organization.
Learn more about second class of stock:-
https://brainly.com/question/31361229
#SPJ4
None of the above could constitute a second class of stock Treasury inventory refers to shares of a agency's stock that have been repurchased by the corporation itself.
It does not constitute a second class of stock. Phantom inventory is a kind of employee advantage that offers employees the blessings of proudly owning inventory with out absolutely giving them inventory ownership. It does not represent a second class of stock. Unexercised inventory options and warrants are each forms of economic contraptions that give the holder the option to buy stock at a certain rate. however, they do not represent a 2nd class of inventory. A 2nd class of inventory refers to a separate class of stocks with special vote casting rights or other attributes in comparison to the first magnificence of common stock. it is typically used to present sure shareholders more manipulate
Learn more about stock here:
brainly.com/question/31361229
#SPJ11
a brand character statement is a brief description of the evidence that backs up the product promise.
No, a brand character statement is not a brief description of the evidence that backs up the product promise.
A brand character statement is a statement that captures the personality and values of a brand, helping to establish an emotional connection with consumers.
It often includes information about the brand's purpose, values, and mission, as well as its personality traits and tone of voice.
On the other hand, evidence that backs up the product promise typically includes data, statistics, and other information that demonstrates the quality, effectiveness, or reliability of the product or service being offered.
To know more about brand character refer to-
https://brainly.com/question/14446747
#SPJ11
loans that require payments of principal and interest at regular intervals are called ______.
Loans that require payments of principal and interest at regular intervals are called amortizing loans.
In an amortizing loan, the principal and interest are paid through a series of fixed, regular payments, which gradually reduces the outstanding principal balance over time. A loan that amortises is one in which the principal is repaid over the course of the loan in accordance with a schedule, often through equal payments. A bond that also repays a portion of the principal along with the coupon payments is known as an amortizing bond.
Learn more about amortizing loan- https://brainly.com/question/30506437
#SPJ11
a business model in which the entrepreneur arranges a customer to host a party, inviting friends, family, and neighbors is called
A business model in which an entrepreneur arranges for a customer to host a party, inviting friends, family, and neighbors, is called a "home party plan" or "party plan business model."
In this model, the entrepreneur partners with a host who invites their social network to the event. The entrepreneur typically demonstrates and sells their products or services during the party. This business model has several benefits, including leveraging the host's social connections for marketing and sales.
The relaxed, social atmosphere of a home party often encourages attendees to interact with the products and make purchases more willingly than in traditional retail settings. Additionally, the host usually receives incentives, such as discounts or free products, based on the sales generated at their party.
The home party plan model is popular among direct sales companies, which typically focus on products such as cosmetics, home décor, or kitchenware. The model's success relies on a combination of strong personal relationships, effective product demonstrations, and the social dynamics of the event. Overall, this business model can create a win-win situation for both the entrepreneur and the host, resulting in increased sales and customer satisfaction.
For more questions on: entrepreneur
https://brainly.com/question/353543
#SPJ11
209. A perpetual preferred stock pays $5 annual dividends at a
par value of $100. The current stock price is $75. The market's
required rate of return on this security is closest
to:
A. 5%
B. 7%
C. 1
The market's required rate of return on this perpetual preferred stock is closest to 6.67% (Option B).
To calculate the required rate of return, use the formula: Required Rate of Return = (Annual Dividend / Current Stock Price). In this case, the annual dividend is $5, and the current stock price is $75.
Steps to calculate percentage change:
1. Plug the values into the formula: Required Rate of Return = ($5 / $75)
2. Calculate the result: Required Rate of Return = 0.0667
3. Convert the result to a percentage: 0.0667 x 100 = 6.67%
Hence, the required rate of return is approximately 6.67%.
To know more about Rate of Return click on below link:
https://brainly.com/question/24232401#
#SPJ11
McDonald’s tested its delivery service in three Florida cities to assess consumer interest before deciding to expand to 20,000 of its restaurants. What type of experiment was conducted here?
micro market
trail market
experimental market
simulated market
test market
The experiment conducted by McDonald's in three Florida cities to test its delivery service before expanding to 20,000 of its restaurants was a test market.
A test market is a type of experiment that involves introducing a new product or service to a small sample of consumers in a specific geographic area. The goal is to assess consumer interest and gather feedback before a wider launch.
In this case, McDonald's wanted to test its delivery service in a limited market to determine whether it would be profitable and popular enough to expand to a larger audience. By selecting three Florida cities, McDonald's was able to gather data on the demand for its delivery service, assess consumer satisfaction, and identify any potential challenges or opportunities for improvement.
The results of the test market would have allowed McDonald's to make informed decisions about whether to expand the delivery service to other locations or modify the service based on consumer feedback. This type of experiment is a common practice in the food and beverage industry and allows companies to minimize risks associated with new product or service launches.
For more such questions on Test market.
https://brainly.com/question/31013486#
#SPJ11
which sources have the appropriate qualifications to be a credible source of information about how a proposed tax cut would affect the u.s. national debt?
The sources include government agencies, academic institutions, and reputable think tanks.
What are the credible source of informationA credible source of information about how a proposed tax cut would affect the U.S. national debt should possess appropriate qualifications and expertise. Key sources include government agencies, academic institutions, and reputable think tanks.
Government agencies, such as the Congressional Budget Office (CBO) and the Department of Treasury, offer well-researched and unbiased analyses. Academic institutions, particularly those with renowned economics departments, can provide expert insights and empirical evidence.
Reputable think tanks, like the Tax Policy Center or the Heritage Foundation, conduct extensive research and offer policy recommendations.
These sources combine expertise, rigorous analysis, and relevant data to ensure credibility when examining the impact of tax cuts on the national debt.
Learn more about Congressional Budget Office (CBO) at
https://brainly.com/question/813901
#SPJ11
Sardano and Sons is a large, publicly held company that is considering leasing a warehouse. One of the company’s divisions specializes in manufacturing steel, and this particular warehouse is the only facility in the area that suits the firm’s operations. The current price of steel is $784 per ton. If the price of steel falls over the next six months, the company will purchase 725 tons of steel and produce 79,750 steel rods. Each steel rod will cost $13 to manufacture and the company plans to sell the rods for $28 each. It will take only a matter of days to produce and sell the steel rods. If the price of steel rises or remains the same, it will not be profitable to undertake the project, and the company will allow the lease to expire without producing any steel rods. Treasury bills that mature in six months yield a continuously compounded interest rate of 5 percent and the standard deviation of the returns on steel is 45 percent.Use the Black-Scholes model to determine the maximum amount that the company should be willing to pay for the lease. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
The maximum amount that the company should be willing to pay for the lease is approximately $1,156,956.38.
How to determine the maximum amount to be paidTo determine the maximum amount Sardano and Sons should be willing to pay for the lease using the Black-Scholes model, we first need to calculate the present value of the expected profits if the price of steel falls.
1. Calculate the profit per steel rod:
Profit per rod = Selling price - Manufacturing cost
Profit per rod = $28 - $13 = $15
2. Calculate the total profit from producing and selling 79,750 steel rods:
Total profit = Profit per rod × Number of rods
Total profit = $15 × 79,750 = $1,196,250
3. Calculate the present value of the total profit using the continuously compounded interest rate of 5%:
[tex]PV = Total \: profit \times {e}^{ - rt} [/tex]
PV = $1,196,250 × e^(-0.05 * 0.5)
PV ≈ $1,156,956.38
Learn more about present value at
https://brainly.com/question/28304447
#SPJ11
a A new three-year CMO has two tranches. The 'A tranche has a principal of $37.4 million with an annual coupon of 3.85%. The Z tranche has a coupon of 5.81% with a principal of $43.7 million. The mortgages backing the security issue have a fixed rate of 6.77% with a maturity of three years. All payments are made and compounded annually at the end of the year. The issue will be over-collateralized with $6.2 million of equity. Priority payments made to the 'A' tranche will consist of A's promised coupon, all mortgage pool amortization, and any interest accrued to the 'Z' tranche. In the year of A's repayment and after the 'A' tranche has been repaid, the Z' tranche will start to receive its own interest and all mortgage pool amortization. The equity class will only get residual cash flows. How much total cash flow will be received by the 'Z' tranche in year 2 of the CMO? $23.50 million $24.10 million $24.70 million $25.30 million $25.91 million
The total cash flow received by the 'Z' tranche in year 2 of the CMO is $24.10 million. Option B is correct.
To calculate the cash flow received by the 'Z' tranche in year 2, we need to first calculate the cash flows received by the 'A' tranche and the mortgage pool. In year 1, the total cash flow received by the mortgage pool is:
= ($37.4 million x 0.0385) + $6.2 million
= $8.326 million, leaving $35.774 million in principal.
In year 2, the total cash flow received by the mortgage pool is:
= ($35.774 million x 0.0677) + $6.2 million
= $9.565 million, leaving $26.209 million in principal.
The 'A' tranche receives:
= $37.4 million x 0.0385
= $1.44 million, leaving $24.769 million in available cash flow for the 'Z' tranche.
The 'Z' tranche receives:
= $24.769 million x 0.0581
= $1.44 million in interest, plus $9.565 million in mortgage pool amortization, for a total cash flow of $11.005 million.
Adding the $1.44 million in accrued interest from the previous year gives a total cash flow received by the 'Z' tranche in year 2 of $12.445 million.
However, $1.44 million of this cash flow is used to pay off the 'A' tranche's accrued interest, leaving a total cash flow is:
= $11.005 million + $1.44 million + $11.005 million
= $24.10
Therefore, the answer is $24.10 million . Option B holds true.
Learn more about amortization: https://brainly.com/question/26718860
#SPJ11
when then number of needed items are computed based on the number of higher-level items produced, one is operating in a(n)
When the number of needed items are computed based on the number of higher-level items produced, one is operating in a bill of materials (BOM) system.
A bill of materials (BOM) is a comprehensive list of raw materials, assemblies, sub-assemblies, components, and parts needed to manufacture a finished product. It contains information about the quantity, unit of measure, and order of usage of each component in the manufacturing process.
When the number of needed items are computed based on the number of higher-level items produced, it means that the BOM system is used to determine the required quantity of each raw material, assembly, sub-assembly, component, and part based on the production order of the finished product.
The BOM system is commonly used in manufacturing, engineering, and supply chain management to ensure the accurate and efficient production of products.
For more questions like Management click the link below:
https://brainly.com/question/11599959
#SPJ11
Remex (RMX) currently has no debt in its capital structure. The beta of its equity is 1.5. For each year into the indefinitefuture, Remex's free cash flow is expected to equal $25million. Remex is considering changing its capital structure by issuing debt and using the proceeds to buy back stock. It will do so in such a way that it will have a 33% debt-equity ratio after the change, and it will maintain this debt-equity ratio forever. Assume thatRemex's debt cost of capital will be 7.02%. Remex faces a corporate tax rate of 25%. Except for the corporate tax rate of 25%, there are no market imperfections. Assume that the CAPM holds, therisk-free rate of interest is
Remex's potential change in capital structure aims to take advantage of the tax shield provided by the corporate tax rate, thus reducing its overall cost of capital. This change may impact the company's equity beta and should be carefully considered alongside the risk-free rate of interest and the assumptions of the CAPM.
Currently, Remex has no debt in its capital structure, and its equity beta is 1.5. The company's free cash flow is expected to be $25 million per year indefinitely. Remex is considering issuing debt and using the proceeds to buy back stock to achieve a 33% debt-equity ratio, which will be maintained forever. The debt cost of capital for Remex will be 7.02%, and it faces a corporate tax rate of 25%. We will assume the CAPM (Capital Asset Pricing Model) holds and consider the risk-free rate of interest as well.
By changing its capital structure to include debt, Remex can potentially lower its overall cost of capital due to the tax shield provided by the interest payments on debt. This tax shield results from the 25% corporate tax rate, as interest payments are tax-deductible. However, it's important to note that the company's equity beta will likely change after introducing debt to its capital structure, which may affect the cost of equity.
To know more about CAPM, refer here:
https://brainly.com/question/29893013#
#SPJ11
the national political stalemate of the 1800s and early 1890s originated in part because of
The national political stalemate of the 1800s and early 1890s originated in part because of disagreements over issues such as slavery, states' rights, and economic policies.
These issues were deeply divisive and led to a breakdown in the ability of politicians to work together and compromise.
Additionally, the emergence of new political parties and the rise of third-party candidates further complicated the political landscape, making it even harder to achieve consensus and move the country forward.
Ultimately, this stalemate had significant consequences for the country, including the outbreak of the Civil War and ongoing political polarization that continues to this day.
To know more about Civil War click on below link:
https://brainly.com/question/11874600#
#SPJ11
Say, because of COVID-19 pandemic, many supply chains are broken and there is loss of entrepreneurship. What should be the possible effect of it on the production possibility curve of the United states? Select one: a. it should be rotating out on the horizontal axis. b. it should be rotating out on the vertical axis. c it should be shifting outward. d it should be shifting inward.
Because of COVID-19 pandemic, many supply chains are broken and there is loss of entrepreneurship. The possible effect of it on the production possibility curve of the United states d. it should be shifting inward.
This means that the economy will produce fewer goods and services as a result of the disruption in the supply chains and the decrease in entrepreneurial activity. This shift will result in a decrease in the productive capacity of the United States, and it may take some time for the economy to recover from this setback.
It is important to note that this shift is a short-term effect, and once the supply chains are restored and entrepreneurship picks up again, the production possibility curve will shift outward once again. In the meantime, the United States will have to find ways to adapt to the new normal and work towards rebuilding its productive capacity. Because of COVID-19 pandemic, many supply chains are broken and there is loss of entrepreneurship. The possible effect of it on the production possibility curve of the United states d. it should be shifting inward.
Learn more about supply chains at:
https://brainly.com/question/28145705
#SPJ11
McMillin Industries is currently 100% equity financed, has 25,000 shares outstanding at a price of $30 a share, and produces an annual EBIT of $150,000. The firm is considering issuing $300,000 of debt and repurchasing shares. The cost of debt is 12%. Ignore taxes. By how much will EPS change if the company issues the debt and EBIT remains constant?
If McMillin Industries issues the debt and repurchases shares, the earnings per share (EPS) will increase.
The increase in EPS can be calculated by subtracting the interest on the debt from EBIT, then dividing the remainder by the number of shares outstanding.
In this case, the new EPS would be $150,000 - $36,000 ($300,000 x 12%) = $114,000 / 25,000 shares = $4.56. This represents an increase of $2.56 per share from the current EPS of $2.
In addition to increasing the EPS, issuing debt and repurchasing shares will result in a decrease in McMillin Industries’ risk, as the debt component of the capital structure will increase.
This will also result in a reduction in the cost of capital, as the cost of debt is usually lower than the cost of equity. Therefore, McMillin Industries should carefully consider issuing debt and repurchasing shares as it could lead to a higher return on the firm’s investments.
Know more about earnings per share here
https://brainly.com/question/31462140#
#SPJ11
Aaron received a 30 year loan of $315,000 to purchase a house. The interest rate on the loan was 4.10% compounded semi-annually.
a. What is the size of the monthly loan payment?
Round to the nearest cent
b. What is the balance of the loan at the end of year 3?
Round to the nearest cent
c. By how much will the amortization period shorten if Aaron makes an extra payment of $30,000 at the end of year 3?
a. To calculate the size of the monthly loan payment, we need to use the formula for mortgage payments:
P = L[c(1 + c)^n]/[(1 + c)^n - 1]
Where:
P = monthly payment
L = loan amount
c = periodic interest rate
n = total number of payments
First, we need to convert the annual interest rate to a semi-annual rate:
r = 4.10% / 2
= 0.0205
Next, we need to calculate the total number of payments:
n = 30 years x 12 months
= 360
Now we can plug in the values and solve for P:
P = 315,000[0.0205(1 + 0.0205)^360]/[(1 + 0.0205)^360 - 1]
P = $1,527.72
Therefore, the size of the monthly loan payment is $1,527.72.
b. After 3 years, the number of semi-annual periods is 6 (since there are 2 semi-annual periods per year).
Using the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
A = ending balance
P = principal amount
r = annual interest rate
n = number of times interest is compounded per year
t = time in years
We can calculate the balance of the loan at the end of year 3 as follows:
A = 315,000(1 + 0.041/2)^(2*6)
= $290,615.96
Therefore, the balance of the loan at the end of year 3 is $290,615.96.
c. Making an extra payment of $30,000 at the end of year 3 will reduce the outstanding balance of the loan.
To calculate the new amortization period, we need to first calculate the new monthly payment based on the reduced principal:
L = 290,615.96 - 30,000
= 260,615.96
n = 30 years x 12 months
= 360
P = 260,615.96[0.0205(1 + 0.0205)^360]/[(1 + 0.0205)^360 - 1]
P = $1,248.09
The new monthly payment is $1,248.09.
We can now calculate the new amortization period using the same formula:
n = log[P/(P - rL)] / log(1 + r)
Where:
log = logarithm
P = monthly payment
L = original loan amount
r = periodic interest rate
For the original loan, n = 30 years x 12 months
= 360.
For the new loan, we have:
n = log[1248.09/(1248.09 - 0.0205*260,615.96)] / log(1 + 0.0205)
n = 322 months or 26 years and 10 months
Therefore, making an extra payment of $30,000 at the end of year 3 will shorten the amortization period by 3 years and 2 months.
To know more about mortgage payments refer here
brainly.com/question/24174269#
#SPJ11
6) Baldwin Corp. just paid a dividend of $2.00. Over the next two years, this dividend is expected to grow by 20% per year. After two years, dividend growth is expected to level off at 10%. If the required rate of return on Baldwin stock is 12%, what should be the price of Baldwin stock today?
Baldwin Corp. paid a dividend of $2.00 which is expected to grow by 20% per year. After two years, dividend growth is expected to level off at 10%. Given the required rate of return on Baldwin stock is 12%. The price of Baldwin stock today should be $162.90.
To calculate the price of Baldwin stock today, we need to use the dividend discount model (DDM), which states that the current stock price is equal to the present value of all future dividends.
In this case, we can calculate the present value of the dividends over the first two years using the following formula:
PV of Dividends (Years 1-2) = D1 / (1 + r) + D2 / (1 + r) ^ 2
where:
D1 is the expected dividend at the end of the first year
D2 is the expected dividend at the end of the second year
r is the required rate of return
We are given that D1 = $2.00 * 1.2 = $2.40 and D2 = $2.40 * 1.2 = $2.88. Plugging in these values and r = 12%, we get:
PV of Dividends (Years 1-2) = $2.40 / (1 + 0.12) + $2.88 / (1 + 0.12) ^ 2
= $2.14 + $2.26
= $4.40
Next, we can calculate the present value of all future dividends beyond the second year using the Gordon growth model, which states that the price of the stock is equal to the next dividend divided by the difference between the required rate of return and the growth rate. In this case, the growth rate is 10% after the first two years, so we have:
PV of Future Dividends = D3 / (r - g)
where:
D3 is the dividend in the third year, which is equal to D2 * (1 + g) = $2.88 * 1.1 = $3.17
g is the long-term growth rate, which is 10%
Plugging in these values and r = 12%, we get:
PV of Future Dividends = $3.17 / (0.12 - 0.1)
= $158.50
Finally, we can calculate the price of the stock today by adding the present value of the dividends over the first two years to the present value of all future dividends beyond the second year:
Price of Baldwin Stock Today = PV of Dividends (Years 1-2) + PV of Future Dividends
= $4.40 + $158.50
= $162.90
To know more about Stock prices here:
https://brainly.com/question/29997372#
#SPJ11