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2 years ago

Which is an example of a high-risk investment?

Business

2 answers:

vladimir1956 [14]2 years ago

6 0

The answer is A stock in a start-up company

Yuki888 [10]2 years ago

3 0

<u>The option A is correct. </u>

<u>Stock in a start-up company is an example of high-risk investment. </u>

Further Explanation:

High-risk investment is a type of investment that has a high risk and high return. The investment may grow beyond the expectation, the investor will earn a huge profit. The high-risk investment may fall beyond the expectation, the investor will incur a huge loss.

Justification for the correct and incorrect answer:

Stock in a startup company: This option is correct.

The startup company does not have a fixed share price. If the company may grow, the share price goes up. If the company may not grow, the share price goes down. This is a type of high-risk investment.

Bond: This option is incorrect.

The bond pays a fixed interest on the investment. As there is no risk, this is not a high-risk investment. Bond is a risk less investment.

CDs from an insured bank: This option is incorrect.

The full of from of CDs is a certificate deposit. As this investment is insured by the bank, there is no risk. This is the incorrect option.

401k plan: This option is incorrect.

401k plan is a type of retirement account that has been opened by the employers. This does not have any type of risk associated with it.

Learn more:

1. Learn more about retirement

<u>brainly.com/question/1430460 </u>

2. Learn more about life insurance

<u>brainly.com/question/2674013 </u>

3. Learn more about negotiating the plan

<u>brainly.com/question/10089477 </u>

Answer details:

Grade: Middle School

Subject: Accounting

Chapter: Investment

Keywords:

high-risk investment, 401k plan, stock, company, startup, high risk, expectation, may grow, bond, CDs from an insured bank, type of investment.

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Answer:

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Explanation:

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2 years ago

The following lots of a particular commodity were available for sale during the year: Beginning inventory 10 units at $60 First

Rus_ich [418]

Answer:

The answer is: the amount of inventory at the end of the year was $1,583 using the average cost method.

Explanation:

The average cost method calculates the cost of inventory by dividing the total costs of goods by the total units.

10 units x $60 = $600
25 units x $65 = $1,300
30 units x $68 = $2,040
15 units x $75 = $1,125

The total cost of inventory is $5,065 ($600 + $1,300 + $2,040 + $1,125)

The total units in inventory are 80 (10 + 25 + 30 +15)

To find the average cost per unit = $5,065 / 80 units = $63.31

If 25 units were left at the end of the year, then the total cost of inventory is $63.31 x 25 = $1,582,81 or $1,583

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2 years ago

Suppose Ernie gives up his job as financial advisor for P.E.T.S., at which he earned $30,000 per year, to open up a store sellin

8_murik_8 [283]

a) Ernie's accounting profit is <u>$40,500</u>.

b) Ernies economic profit is <u>$10,500</u>, excluding the salary forgone (opportunity cost) from the accounting profit.

<h3>What is the difference between accounting profit and economic profit?</h3>

The difference between accounting profit and economic profit is that accounting profit does not consider the opportunity costs, which economic profit factors in.

Accounting profit is narrower in concept than economic profit. It is simply revenue minus total costs without opportunity cost.

Economic profit, on the other hand, includes the opportunity costs in the total costs.

<h3>Data and Calculations:</h3>

Salary per year at P.E.T.S = $30,000

Annual interest from savings = $500 ($10,000 x 5%)

Revenue in the new business = $50,000

Explicit costs = $10,000

Accounting profit = $40,500 ($50,500 - $10,000)

Economic profit = $10,500 ($50,500 - $10,000 - $30,000)

Thus, Ernie's accounting profit is <u>$40,500</u> and the economic profit is <u>$10,500</u>.

Learn more about accounting profit and economic profit at brainly.com/question/27113609

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1 year ago

Which term is defined as the lack of satisfaction a person receives from using a product repeatedly

Studentka2010 [4]

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2 years ago

Baker Corp. is required by a debt agreement to maintain a current ratio of at least 2.5, and Baker's current ratio now is 3. B

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Answer:

$1.67 Million

Explanation:

Current asset = 15 Million

Current liabiltiy = 15 Million/3

= 5 Million

Let the inventory X can be purchased with short term debt without violation

per current ratio requirement

(15 + x)/5+x = 2.5

15 + x = 12.5 + 2.5x

2.5 = 1.5x

x = $1.67 Million

Therefore, $1.67 Million inventory can Baker purchase without violating its debt agreement if their total current assets equal $15 million

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3 years ago