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dlinn [17]
2 years ago
5

Your next-door neighbor, a kind, elderly lady, just discovered that her stock account had been excessively traded in an inapprop

riate manner, mainly to generate excess commissions. This is an example of Question 14 options: account theft. black market trading. high turnover trading. churning. None of these.
Business
1 answer:
SVETLANKA909090 [29]2 years ago
7 0

This is an example of Churning.

<h3><u>What is Churning?</u></h3>
  • Churning, or excessive trading of assets in a client's account by a broker to generate commissions, is an unlawful and unethical practice.
  • Churning cannot be quantified, it may be demonstrated by the repeated purchasing and selling of stocks or other assets that fall short of the client's investing goals.
  • Churning is the practice of exchanging assets excessively in a client's brokerage account in an effort to earn commissions.

Learn more about churning with the help of the given link:

brainly.com/question/10845172?referrer=searchResults

#SPJ4

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"The company will pay a dividend of $15 per share 10 years from today and will increase the dividend by 5 percent per year there
statuscvo [17]

Answer:

Current Share price= $114.21

Explanation:

The Dividend Valuation Model is a technique adopted to detremine the value of an asset. According to this model, the value of an asset is the sum of the present values of the future cash flows that would arise from the asset discounted at the required rate of return (discount rate)

The model is premised on the concept of the time value of money. The idea that $1 today is not the same as $1 tomorrow. The $1 of today is worth more than that of tomorrow; because of the opportunity to earn interest. So to determine the worth of a future cash flow, we compute its worth today- its present value.

The Present Value of a future cash flow is the amount that needs to be invested today at a particular rate of return to equal the same cash flow in the future. Present value means the value in year 0 or now

The process of calculating the present value of a future sum is called discounting. So to calculate the current stock price in this question, we shall discount the future dividends using the required rate of return and then add them together.

So if an asset (e.g a stock) promises some cash flows in the future, those cash flows need to be brought to their present values and then be added to arrive at the value of the asset

In this question, the cash flows are the dividends as given and the rate of return (discount rate) is 15%

So we apply this model as follows:

Step 1 : PV of div from year 1 to 10  =  15× ((1-1.15)^(-10))/0.15)  =  75.282

Step 2:PV (in year 10)of div from year 11 onward=(15×1.05)/(0.15-0.05)=  157.5

Step 3:PV(in year 0) of div from year 11 onward =  157.5 × (1.15)^ (-10) =  38.93

Current Share price= $75.282 + $38.93 = $114.21

<em>Note:</em><em> step 3 is important because the the cash flows from year 11 onward were discounted to arrive at their values in year 10. Since we are interested in the current price i.e year 0 value, it is important that we re-discount again to bring them to their PV in year 0.</em>

8 0
2 years ago
Which of the following allows the insurer to relieve a minor insured from premium payments if the minor's parents have died or b
loris [4]

Answer:

The correct answer is a) Payor Benefit

Explanation:

When the payor dies or becomes disabled, the insurer will suspend the premiums until the child reaches 19 years old, the child must be under age 18, or up to age 19 and still attending high school. Usually, the payor is a parent (father, mother, brothers).

4 0
3 years ago
Which words means finds its food; a consumer.?
notsponge [240]

Answer:

The word that means finding its food is hunting

6 0
2 years ago
Charles and nancy have decided to sell their family business and would like to transfer ownership to the next generation. which
kramer
The best method to make money would be the best

5 0
3 years ago
Quinlan has ample E &amp; P to cover any distributions made during the year. One distribution made to a shareholder consists of
stepladder [879]

Answer:

1.Quinlan distribution has realized a loss of

$214,480 of which $0 is recognized.

2. The shareholder received property with a basis of $321,720

Explanation:

1.

When property is been said to be distributed to shareholders the amount of dividend equal to the fair value of the said property which is $321,720 on the date of the distribution. Therefore the amount of taxable dividend is $321,720 which is before the dividends received deduction.

Therefore;

Net loss which shall not be allowed ($536,200-$321,720)

=$214,480

Quinlan distribution has realized a loss of

$214,480 which is not allowed to be recognized

2. Adjusted basis of the property distributed is $321,720

6 0
3 years ago
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