Passive income is an income earned without making an extra effort. According to the US Internal Revenue Service, passive income could be in two forms: rental income and income earned from business and trade activities. Additionally, royalty is an example of a passive income. Therefore, the correct answer is B.
Answer:
$8,000
Explanation:
The computation of the amount of dividend received by the preferred shareholders in year 2 is shown below:
Annual preferred dividend = Par value of preferred stock × Dividend rate on preferred stock
= 200,000 × 4%
= $8,000
By multiplying the par value with the dividend rate we can get the amount of dividend received and the same is shown above
Answer:
Chris paid $109.68 for his bond. Since he paid a premium for the bond, the YTM is lower than the coupon rate.
Explanation:
yield of Cheryl's bond is 6% since she purchased it at par and the bond's coupon is 6%
if Chris's bond yields 80% of Cheryl's, it will yield 6% x 0.8 = 4.8%
we can use the approximate yield to maturity formula to find the market price of Chris's bond:
2.4%(semiannual) = {3 + [(100 - MV)/20]} / [(100 + MV)/2]
0.024 x [(100 + MV)/2] = 3 + [(100 - MV)/20]
0.024 x (50 + 0.5MV) = 3 + 5 - 0.05MV
1.2 + 0.012MV = 8 - 0.05MV
0.062MV = 6.8
MV = 6.8 / 0.062 = 109.68
Answer:
B Deliberate
Explanation:
Planning involves thinking ahead of events. It entails preparing beforehand for future activities. Managers will engage in planning to ensure the business meets its objectives.
There are different types of plans. Manager can make short term or long term plans which are based on time. Strategic plans are about methodology or procedure. Deliberate is not a type of planning.
