Answer:
A). 17.13 %
Explanation:
Given that,
Annual Dividend for the first year = $.58,
Annual Dividend for the second year = $.66
Annual Dividend for the third year = $.72
Annual Dividend for the fourth year = $.75
The current price per share = $10.08
To find;
The cost of equity = ?
Procedure:
(0.66 - 0.58)/0.58 = 0.137931034
(0.72 - 0.66)/0.66 = 0. 0909090909
(0.75 - 0.72)/0.72 = 0.0416666667
g = (0.137931034 + 0. 0909090909 + 0.0416666667)/3
= 0.0901689305
= {(0.75 * 1.0901689305)/10.08} + 0.0901689305
= 0.17128269
∵ 17.13% is the cost of equity.
Answer:
The incidence of a tax is determined by which group (buyers or sellers) must actually pay the government. FALSE, the real effect of taxes is measured by the price elasticity of the demand and the supply.
When demand is inelastic and supply is elastic, the burden of a tax falls mainly on producers. FALSE, when the price elasticity of demand is inelastic and the price elasticity of supply is elastic, the burden of tax falls mainly on the consumers.
When demand is elastic and supply is inelastic, the burden of a tax falls mainly on consumers. FALSE, when the price elasticity of demand is elastic and the price elasticity of supply is inelastic, the burden of tax falls mainly on the suppliers.
An excise tax can distort incentives and create missed opportunities for mutually beneficial transactions. TRUE
Answer:
c. Cash....................................................................................... 12,000
Equipment .................................................................... 6,000
Gretel, Capital .......
Explanation:
The journal entry is as follows;
Cash Dr $12,000
Equipment Dr $6,000
To Gretel capital $18,000
(Being the investment done by gretel is recorded)
Here the cash and equipment is debited as it increased the assets while on the other hand the capital account is credited as it also increased the shareholder equity
Therefore the option c is correct
Answer:
The correct answer is option D.
Explanation:
The consumer price index is a tool to measure inflation in the economy. It measures the change in price level through a basket of goods generally purchased by the households. It does not include change in quality.
It is measured as
CPI =
In the given example, the price of the car is increasing but the quality is improving as well. Since the CPI does not include quality, the inflation rate will be overstated.
