Answer:
C. The Federal Reserve will need to have official reserves of euros to purchase dollars in the foreign exchange market.
Explanation:
Federal Reserve required to have a euros reserves as it can applied it also at the case when the exchange rate is move upward or downward
For the other things, the fed could restrict the supply with respect to the dollar in the foreign exchange market in order to get it stable that opposed with euro
Therefore the option c is correct
Answer:
Huprey Co.
Identifying the accounting treatment for each claim as either (a) a liability that is recorded or (b) an item described in notes to its financial statements:
1. Huprey (defendant) estimates that a pending lawsuit could result in damages of $1,550,000; it is unlikely that the plaintiff will win the case.a. A liability that is recorded.
b. An item described in notes to its financial statements.
2. Huprey faces a loss on a pending lawsuit that it is unlikely to lose; the amount is reasonably estimable.
a. An item described in notes to its financial statements. b. A liability that is recorded.
3. Huprey faces a probable loss on a pending lawsuit; the amount is reasonably estimable.a. An item described in notes to its financial statements.
b. A liability that is recorded.
Explanation:
Huprey Co. will recognize and record contingent liabilities in its accounts when it can be reasonably established that the future event will occur and the amount of the liability can be reasonably estimated. The implication is that Huprey Co. must establish two things before a contingent liability is recognized and recorded. One is that the probability or the likelihood or the chance that the event will happen exists and can be estimated. With the probability estimate, it becomes possible for Huprey Co. to also estimate the amount that the happening of the event will cost it.
Answer:
Please see below and attached.
Explanation:
1a. Prepare a contribution format income statement for the game last year. The Net operating income is $90,000.
1-b The degree of operating leverage
= $10.
2a. Net operating income increases by 220%
2b. Total expected net operating income is $288,000.
Please find attached detailed breakdown of the answers provided above
Answer:
company B's cost of equity is 14.0375% - 8.975% = 5.0625% higher than company A's cost of equity
Explanation:
cost of equity = risk free rate + (beta x market premium)
risk free rate = 4.25%
market premium = market return - risk free rate = 11% - 4.25% = 6.75%
Company A's cost of equity = 4.25% + (0.7 x 6.75%) = 8.975%
Company B's cost of equity = 4.25% x (1.45 x 6.75%) = 14.0375%
this means that company B's cost of equity is 14.0375% - 8.975% = 5.0625% higher than company A's cost of equity.
<span>Suppose that the price of sushi take-out, a substitute, decreases in price. What will happen to the demand for Chinese take-out? The demand for Chinese take-out will likely decrease as a substitute is cheaper. Those we are okay with substituting one item with another are often after the price the items sell out versus exactly what the want from the item. Since they are substitutes, more people will likely get the cheaper option, Sushi take-out. </span>
