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3 years ago

Because the liquidity-preference framework focuses on the:

Business

1 answer:

snow_tiger [21]3 years ago

8 0

Answer:

B. Short run, it assumes the interest rate adjusts to bring the money market to equilibrium

Explanation:

This theory is explained to be a model that suggests that an investor should demand a higher interest rate or premium on securities with long-term maturities that carry greater risk because, all other factors being equal, investors prefer cash or other highly liquid holdings.

According to this theory, which was developed by John Maynard Keynes in support of his idea that the demand for liquidity holds speculative power, investments that are more liquid are easier to cash in for full value. Cash is commonly accepted as the most liquid asset. According to the liquidity preference theory, interest rates on short-term securities are lower because investors are not sacrificing liquidity for greater time frames than medium or longer-term securities.

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Real per capita GDP in Taiwan in 1961 was about $500, but it doubled to about $1000.00 by 1981. a. What was the average annual e

aliya0001 [1]

Answer:

the average annual economic growth rate in Taiwan from 1961 to 1981 was 41.42%

Explanation:

Hi, we need to use the following formula.

$FV=PV(1+r)^{t}$

Where:

FV = GDP in 1981 ($1,000)

PV = GDP in 1961 ($500)

r = growth rate

t = years from 1981 to 1961 (20 years)

So, it should look like this:

$1,000=500(1+r)^{20}$

Now, we solve for "r"

$\frac{1,000}{500} =(1+r)^{20}$

$2=(1+r)^{20}$

$\sqrt[20]{2} -1=r$

$r=0.4142$

So, the growth rate of Taiwan´s GDP is 41.42%

Best of luck.

5 0

3 years ago

If a portfolio had a return of 11 the risk-free asset return was 6, and the standard deviation of the portfolios excess returns

Sindrei [870]

The premium would be 5%

If a portfolio had a return of 11 the risk-free asset return was 6, and the standard deviation of the portfolios excess returns was 25 the premium would be 5%

Portfolio return = 11%

Risk free rate = 6%

Risk premium = Portfolio return - Risk free rate

= 11% - 6% =5%

So, the premium would be 5%

Premium is an amount paid periodically to the insurer by means of the insured for overlaying his chance.

Learn more about premium here- https://economictimes.indiatimes.com/definition/premium

#SPJ4

4 0

1 year ago

Abused children live in families of all socioeconomic levels, races, nationalities, and religious groups, although child abuse i

Digiron [165]

Answer:

The correct answer is lower-class nonwhite.

Explanation:

The lower class is the poorest population segment of human society. It is characterized by having great gaps in its way of life and limitations in terms of access to economic resources. They are usually unemployed people, who do not own their own home or other goods or properties that are essential for living.

To this socioeconomic class belong people with very low educational levels, barely with primary education and some with secondary education. Some casual or independent workers also enter this class. Lower class families do not have good basic services in their homes.

6 0

4 years ago

The trial balance of Rollins Inc. included the following accounts as of December 31, 2021:

Alinara [238K]

Answer:

Net income = $725,625

Earnings per share = $7.26 per share

Explanation:

The multiple-step income statement refers to an income statement that displays gross profit obtained as sales revenue minus cost of goods sold, and also shows an organization's operating revenues and operating expenses separately from its nonoperating revenues or gains and expenses or losses.

The multiple-step income statement can be prepared as follows:

Rollins Inc.

multiple-step income statement

For the Year Ended December 31, 2021

Details $ $

Sales Revenue 5,400,000

Cost of goods sold (3,950,000)

Gross profit 1,450,000

Operating expenses:

Selling expense (350,000)

General and admin expense (250,000)

Total operating expenses (600,000)

Operating income 850,000

Interest revenue (expense):

Interest revenue 37,500

Interest expense (20,000)

Total Interest revenue (expense) 17,500

Other compreh. income (loss):

Loss on sale of investments (10,000)

Loss on debt investments (125,000)

Gain on projected ben. obligation 235,000

Total other compreh. income (loss) 100,000

Income before tax 967,500

Income taxes (w.1) (241,875)

Net income  725,625 

Earnings per share (w.2) 7.26

Workings:

w.1: Income taxes = Income before tax * Effective tax rate = $967,500 * 25% = $241,875

w.2: Earnings per share = Net income / Number of shares of stock outstanding throughout the year = $725,625 / 100,000 = $7.26

7 0

3 years ago

Estimate the value of a share of Intel common stock using the residual operating income (ROPI) model as of December 25, 2010; as

wariber [46]

Answer:

Using

F=P(1+i)^n equation

we will have

n=5 years

i=11%=0.11

P=5511 million

F=23424 million

7 0

3 years ago