Answer:
the acid-test ratio is 1.5 times
Explanation:
The computation of the acid-test ratio is as follows:
Acid test Ratio = Quick assets ÷ current liabilities
where,
Quick Assets is
= Cash + short tern investments + Account receivable
= $3,500 + $50,000 + $56,000
= $109,500
And, the current liabilities is $73,000
So, the acid-test ratio is
= $109,500 ÷ $73,000
= 1.5 times
Hence, the acid-test ratio is 1.5 times
Answer:
The borrower is best off in situation <u>"a"</u> and the lender is best off in situation ▼ "C" .
Explanation:
Considering all the situations given in the options, the <u>borrower</u> is best in situation <u>a</u> and <u>lender</u> is best off in situation in <u>c</u>.
<u>Part a </u>
Real Interest rate = Nominal Interest rate - Inflation rate = 14 - 17 = -3 per cent. Thus, the purchasing power of money has fallen and the person has to pay back money with little purchasing power as compared to the value of the purchasing power at the time he borrowed money. Thus, borrowers are best off.Thus, <u>borrower</u> is best off when the inflation rate is very high.
<u>Part c</u>
Inflation rate is negative, thus the purchasing power of money will increase and lenders will get back money with higher purchasing power as compared to the value of the purchasing power of money at the time he lend the money. Thus, <u>lender </u>is best off when inflation rate is lowest.
Answer:
the stock price <u>has decreased in the same proportion as the dividend. </u>
Explanation:
Since we are told that the dividend yield remained the same, and the dividend decreased by 2.03%, we know that the price of the stock decreased by 2.03%.
= [($1.45 - $.148) / $1.48] x 100 = -2.03%