Answer:
D. Ensure that she credits the loan amount accurately to the customer’s account
Explanation:
Financial institutions are companies that offer a wide range of monetary and financial services to various customers. The financial institutions include; commercial banks, brokerage firms, investments firms and currency exchange companies. The services offered are; cash deposits and withdrawals, loans, investment services and currency exchange services.
These services can be offered to individuals or even companies that might need a wide range of financial services. In order for these services to be conducted in an orderly fashion, the services offered have to be regulated. This means that the service providers and the customers have to operate within a legal threshold. A knowledge of the legal responsibility of each party is therefor important in these type of environment.
In our case, the legal responsibility of Erin who works as a representative of the financial institution would be to ensure that she credits the loan amount accurately to the customer's account since Erin had already approved the customer's housing loan.
Profit Inc., a manufacturing firm, has purchased raw materials worth $10,000 on credit from its vendors. The business plans to settle the vendor’s full payment after two months. Under "current liabilities"section of balance sheet this account will be recorded as "account payable".
Answer: Option (B) is correct
<u>Explanation:</u>
Raw material purchased on credit from a vendor is a liability and it is shown under current liabilities in "accounts payable". Since raw material purchased on credit and payment is to be made after two months.
Payment due gives rise to liability. Now current liability is a company's short term obligations that are to be paid back within a year. Here the firm will have to make payment within two months to the vendor.
Answer:
B) inside director
Explanation:
An inside director is a member of the board of directors that is also an employee of the company. Usually inside directors should be part of the top management of the company, but in some particular cases that may not apply (e.g. in European cooperatives unions are represented by one member in the board).
It doesn't matter if the directors are inside or outside directors (don't work in the company), they all have a duty of care to the company.
Answer:
(a) $0 (b) 0% (c) 50% (d) -40% (e) 0.444 and 0.556 (f) -0.05
Explanation:
(a) Profit (in $) = (increase in price per share of Harley-Davidson * number of Harley-Davidson shares held) - (decrease in price per share of Yahoo * number of Yahoo shares held)
= $90 - $60 = $30 increase in Harley Davidson and $25 - $15 =$10 decrease in Yahoo
= ($30*100) - ($10*300) = $0
(b) return on portfolio = return/capital invested * 100 = $0/($60 * 100 + $25 * 300) = $0/$13500 = 0%
(c) return on investment in Harley = return/capital invested in Harley * 100 = $30*100/$60*1000 = $3000/$6000 = 50%
(d) return on investment in Yahoo = return/capital invested in Yahoo * 100 = -$10*300/$25*300 = -$3000/$7500 = - 40% (negative rate of return)
(e) Weighting at the beginning of year (in decimals)
Harley Davidson = $60 * 100 units/ total invested ($60 * 100 + $25 * 300)
= $6000/$13500 = 0.444
Yahoo = $25 * 300 units/ total invested
= $7500/$13500 = 0.556
(f) realized returns (as a decimal) of the portfolio = 0.444*50% + 0.556*-40%
= -0.0493728
= - 0.05 (to decimal places)
Answer:
Economic recession
Explanation:
A recession occurs when an economy faces a negative real GDP for two successive quarters or more. In a business cycle, the recession would be a period that occurs between the peak and the trough.
A recession can be caused by many factors:
1. High interest rates
2. High unemployment
3. Low consumer and business confidence
It is possible to say that all factors are interconnected. For example, when interest rates are higher, it means that people will spend less on borrowed money, as now borrowing money is more costly. This in turn means that demand for products are lower, leading to lower business confidence. When sales are low, businesses may attempt to cut back on costs to ensure profits. This can take the form of laying off workers. Hence, unemployment in the economy will increase. Consumer confidence will also plummet.
Some consequences may include:
1. Fall in inflation: As aggregate demand in the economy falls, price levels will fall. Thus, reducing inflation.
2. Government deficit: the government may have to start spending more on expenditures such as unemployment benefits. On the other hand, income generated from corporate/income taxes will fall. Fall in income and rise in expenditure causes a deficit.
3. Environmental pollution is less: Due to less movement in the economy, polluting factors such as factory smoke, vehicle congestion and waste send to landfill will be much lesser. This would prove to be beneficial for the environment.
