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3 years ago

Which of the following is true about product markets?

Business

1 answer:

jeka943 years ago

6 0

Answer:

The correct answer is option D.

Explanation:

A product market deals with goods and services. In a product market goods and services are supplied by firms and businesses and purchased by households.

The households in exchange pay businesses and firms which is known as consumer spending for households.

A product market is concerned with the flow of finished goods and services, it does not involve trade in raw materials and other intermediate goods.

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Linke Motors has a beta of 1.30, the T-bill rate is 3.00%, and the T-bond rate is 6.5%. The annual return on the stock market du

elena-14-01-66 [18.8K]

Answer:

c. 11.05%

Explanation:

The computation of firm's required return is shown below:-

First we need to find out the Market Risk Premium for computing the firm's required return.

Using CAPM, we calculate Market Risk Premium

Expected Future Market Rate of Return = Risk Free Rate on T-Bond + Beta of the Market × Market Risk Premium

10% = 6.5% + 1 × Market Risk Premium

Market Risk Premium = (10% - 6.5%) ÷ 1

= 3.5%

Required Rate of Return = Risk Free Rate + Beta of the Stock × Market Risk Premium

= 6.5% + (1 + 3.00%) × 3.5%

= 6.5% + 1.30 × 3.5%

= 11.05%

8 0

4 years ago

Turnadot & Sons is a small wholesaler of decorative cast iron objects. The following events, related to a special customer o

Katena32 [7]

Answer:

Gross Margin = $6,000

Explanation:

Gross margin refers to the Sales price - Direct cost associated with the product.

Here, Sales Value = 200 outdoor planters for $50 each = $50 $\times$ 200 = $10,000

Cost associated with this outdoor planters = Purchase cost as paid to supplier = $4,000

Thus, gross margin = $10,000 - $4,000 = $6,000

Note: Time period and dates provided for such sales and collection of amount or payment to supplier is of no relevance.

Final Answer

Gross Margin = $6,000

4 0

3 years ago

Analysis of a company's financial statements: Below are simplified versions of the balance sheet and income statement for Toys b

il63 [147K]

Answer:

The answer is:

A 15% increase in inventory turns for Toys by Tom, Inc. would bring this ratio to 4.8 times, suggesting improvement in efficiency.

Explanation:

We have the current Inventory turnover = COGS / Inventory = 41,700/10,000 = 4.17 times

=> An 15% increase in the Inventory turnover will bring the Inventory turnover ratio to: 4.17 x 1.15 = 4.8 times;

Increasing in inventory turnover may be the result of higher sales ( thus higher COGS) or low level of inventory holding - thus limiting the resources spending on idle inventory. So, higher level of inventory turnover in someways suggesting improvement in efficiency.

6 0

3 years ago

For a qualifying relative to be claimed as a dependent, a person must either be related to the taxpayer, or be a member of the t

Burka [1]

Answer:

The correct option is (C)

Explanation:

To be able to claim somebody as a dependent, the person has to qualify 4 tests. They are:

Lineal descendant
Must live with the taxpayer for more than a year
Should be below 19 years or under 24 if a full time student
Cannot file return on their own.

If a person who is not a lineal descendant to be claimed as a dependent needs to be a part of taxpayer's household for 365 days (whole year).

In this case, taxpayer's cousin is not a lineal descendant. Rest of them (sister, father and son-in-law) are lineal descendants. So, cousin has to stay with the taxpayer for the entire year.

5 0

3 years ago

What return do you expect earn if you buy the 3 years ,10% coupon bond today and sell it in exactly 1 year( if current price is

IrinaK [193]

Answer:

8.02%

Explanation:

Since corporate bonds pay coupons semiannually, it would be important to first all determine the semiannual yield to maturity of this bond using a financial calculator as shown below:

We need to set the calculator to its end mode before making the following inputs:

N=6(number of semiannual coupons in 3 years=3*2=6)

PMT=50(semiannual coupon=face value*coupon rate/2=1000*10%/2=50)

PV=-1051.45 (current price)

FV=1000(bond's face value)

CPT

I/Y=4.02%

After one year, there would 4 semiannual coupons left, we can compute the bond price as shown thus:

N=4

PMT=50

I/Y=4.02(without % sign)

FV=1000

CPT

PV=1,035.56

The expected rate of return over one year is computed thus:

N=2(number of semiannual coupons in 1 year holding period)

PMT=50(the amount of each semiannual coupon)

PV= -1051.45

FV=1,035.56(selling price after one year)

CPT=4.01%(on a semiannual basis)

annual rate of return=4.01%*2=8.02%

7 0

3 years ago

Which of the following is true about product​ markets?

Which of the following is true about product markets?