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frosja888 [35]
3 years ago
10

C has a $100,000 traditional whole life insurance policy with a $30,000 cash surrender value. He applies for and receives a $10,

000 policy loan from the insurer.
Business
1 answer:
Ivenika [448]3 years ago
3 0

Answer:

If C were disabled, his beneficiaries would receive $70,000, less any outstanding interest charges

Explanation:

Policy loans can generally amount up to 100% of the cash surrender value of the policy, in this case C only requested $10,000 (1/3 of the cash value). This type of loan is fully collateralized by the cash value of the policy and the borrower can even miss some payments or pay on a later date because interests keep adding.

This type of loan can carry a fixed or variable interest rate, depends on the insurer.

If C surrenders his policy, he will receive the total cash surrender value minus the loan amount = $30,000 - $10,000 = $20,000

If C dies, his beneficiaries would receive the full benefits minus the loan amount = $100,000 - $10,000 = $90,000

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he next dividend payment by Savitz, Inc., will be $2.34 per share. The dividends are anticipated to maintain a growth rate of 4.
Elan Coil [88]

Answer:

The Required Return is 10.82%.

Explanation:

The Dividends Model for the Constant Growth is given below:

                                          P0 = D1 / (Ke - g)

Arranging the above equation for "Ke", that is the Required Return:

                                      ⇒ Ke = (D1 / P0) + g

Putting Values and we get:

Required Return = Ke = (2.34 / 37) + .045 = .1082 = 10.82%.

Thanks!

8 0
3 years ago
Optimization using total value calculates ________.
Jlenok [28]

Answer:

A

Explanation:

Optimization using total value calculates the total value of each feasible option and then picks the option with the highest total value.

Optimization using marginal analysis calculates the change in total value when a person switches from one feasible option to another, and the uses these marginal comparisons to choose the option with the highest total value.

Both gives identical answers.

Optimization can be implemented using many different techniques.

One of it, is Total value total benefit - total cost (net benefit).

It translate all cost and benefits into common units, like dollar per month.

Calculate the total net benefit of each alternative.

Pick the alternative with the highest net benefit.

7 0
3 years ago
If the total debt ratio is 36%, and the allowable mortgage debt ratio is 28%, which of the following debt ratios would a loan ap
schepotkina [342]

Answer:

The loan applicant would qualify for the mortgage debt ratio in option a because his mortgage debt ratio is 24% and the allowable mortgage debt ratio is 28%.

Explanation:

First, you have to calculate the debt ratio in each case. It is calculated by dividing the total debt by the income.

a. Debt= $600

Income= $2,500

Mortgage debt ratio=600/2,500= 0.24→24%

b.  Debt=$600+$250+$75=$925

Income=$2,500

Total Debt ratio=925/2,500= 0.37→37%

The loan applicant would qualify for the mortgage debt ratio because his mortgage debt ratio is 24% and the allowable mortgage debt ratio is 28%. The loan applicant would not qualify for the total debt ratio because his ratio is 37% and the allowable total debt ratio is 36%.

6 0
3 years ago
Aggregate supply (as) denotes, while holding the price of inputs fixed, the ________ that firms choose to produce and ________.
Sedbober [7]

Aggregate supply (as) denotes, while holding the price of inputs fixed, the <u>price level of output</u> that firms choose to produce and <u>GDP.</u>

<h3>What is aggregate supply?</h3>

Aggregate supply is when goods and service produced or manufacture are made available to buyers  or can be defined as the amount of goods produce and supply to the market at particular period of time.

Aggregate supply can tend to increase in a situation were the price of goods and services decrease or when the price of product fall.

Therefore, Aggregate supply donate, while holding the price of inputs fixed, the price level of output that firms choose to produce and Gross domestic product (GDP).

Learn more about Aggregate supply here:brainly.com/question/11889136

brainly.com/question/25749867

#SPJ1

6 0
2 years ago
Charles company used the percent of sales method to determine its bad debts expense. At the end of the current year, the company
fomenos

Answer:

$240,200

Explanation:

The computation of the account receivable amount reported in the balance sheet is given below:

Bad debt expense os

= $900000 × .50%

= $4,500

And,

Allowance for doubtful accounts after adjustment is

= $4,500 + $300

= $4,800

Now

Balance of account receivable is

= $245,000 - $4,800

= $240,200

8 0
3 years ago
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