Answer: Nothing
Explanation:
From the question, we are informed that Z chooses a life income with 10 year period certain settlement option for the annuity Z owns and that Z dies after 15 years of receiving income benefit payments. Based on the above situation, Z's beneficiary receive will receive nothing.
This is because Z has already gotten the income benefits payment since it's for a 10 year period
Answer:
a. 6.7%
b. 12.0%
Explanation:
a. DDM
Dividende Discount Method is used to calculate the price of the stock using Dividend, rate of return and growth rate.
Return on equity = [ Dividend x ( 1 + growth rate ) / Price of stock ] + Growth Rate
Return on equity = [ $0.5 x ( 1 + 6% ) / $76 ] + 6%
Return on equity = [ $0.5 x ( 1.06 ) / $76 ] + 0.06
Return on equity = 6.7%
b. SML
Security Market line method uses calculates the cost of capital using following formula
Re = R
f + β ( Rm − R
f )
Rf = Risk free rate
β = stock beta
Rm = Market rate
Re =Expected rate
Re = 5.9% + 1.20 ( 11% - 5.9% )
Re = 12.02%
Answer:
C. $0.11
Explanation:
When there is excess capacity and there are no incremental fixed costs the break even transfer price would be the marginal cost of production. This is the least transfer price the Bells can sell to Rattle without making a loss. The most likely transfer price then would be $0.11 which allows the bells to cover their costs and also make 1 cent in profits. Option A, B and D would all be making losses where as Option E and F are two steep a price and may be unprofitable for rattle.
Hope that helps.
Answer: a) increases expenses and lowers taxes.
Explanation:
Depreciation accounts for the wear and tear in fixed assets over their period of use. It is accounted for every period in the Income Statement as an expense which means that its addition increases the business's expenses.
It does that the advantage of being tax deductible however. This then means that it can be subtracted from Net Income for tax purposes. When that is done, it will reduce the Net Income thereby reducing the amount of taxes that can be charged on the company.
Answer:
Investment banks.
Explanation:
Investment banking is the financial service described in the paragraph, could be a company or a division of it, dedicate it to give advisory about financial transactions, raising capital, even-though restructuring and mergers activities.