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Viktor [21]
3 years ago
8

The money multiplier: question 20 options:

Business
1 answer:
Bingel [31]3 years ago
5 0
The correct answer is c

<span>c.measures the maximum amount the money supply can increase when new deposits enter the banking system

</span>
<span>. The money multiplier is the amount of money that banks generate with each dollar of reserves. Reserves is the amount of deposits that the Federal Reserve requires banks to hold and not lend. Banking reserves is the ratio of reserves to the total amount of deposits</span>
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A proposed new project has projected sales of $186,000, costs of $90,500, and depreciation of $24,900. the tax rate is 22 percen
Black_prince [1.1K]

Operating cash flow will be $79,968

A proposed new project has projected sales of $186,000, costs of $90,500, and depreciation of $24,900. the tax rate is 22 percent. Calculate operating cash flow using the four different approaches.

  • EBIT + Depreciation - Taxes

EBIT = S - C -D

EBIT =186,000-90,500-24,900= 70,600

Depreciation = 24,900

Taxes= EBIT x Tax Rate = (.22) x 70,600

= 15,532

EDT= 70,600 + 24,900 - 15,532 = $79,968

  • Top-down

= Sales - Costs - Taxes

= 186,000 - 90,500 - 15,532= $79,968

  • Tax-shield

= (Sales - Cost) x (1 - tax rate) + Depreciation X Tax rate

= (186,000 - 90,500) x (1 - 0.22) + 24,900 x 0.22 = $79,968

  • Bottom-up

= Net income + Depreciation

Net income = EBIT - Tax

Net income = 70,600 - 15,532

= 55,068

= 55,068 + 24,900

= $79,968

What is operating cash flow?

Cash flow from operating activities (CFOA) is the revenue a company generates through ongoing, regular business activities like the creation and sale of goods or the rendering of client services (CFO). It is the first item on a company's cash flow statement.

Learn more about operating cash flow: brainly.com/question/17001006

#SPJ4

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