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Flauer [41]
3 years ago
12

A $10,000 municipal bond with 10 years to maturity is purchased in the primary market at 105. The bond is sold after 2 years at

105. The taxable gain or loss is a:
Business
1 answer:
Mama L [17]3 years ago
7 0

Answer: B. a 2 point capital gain

Explanation:

Municipal Bonds have to be amortized using the straight-line method and this applied to both newly issued or bonds being traded at a premium.

The bond in question is trading at 105 and so has a 5 point premium which needs to be amortized at 1 point a year for 5 years. As it was bought after two years, the amortization was 2 points which means the cost of the bond should be;

105 - 2 = 103

Yet it was sold for 105. The gain is therefore

= 105 - 103

= 2 point capital gain

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Danny deposits $50 in a savings account at 5 percent interest for 3 months. How much will be in the account after 3 months?
sveticcg [70]

Answer:

$ 50.625

Explanation:

Amount of deposit = $50

interest 5 percent  usually per year

Per year interest rate = 5/100= 0.05

Interest rate for 3 months= 0.05/12 x3

      =0.0125

Interest amount =0.0125 x50= 0.625

Money in the account will be

=$50+0.625

=$ 50.625

5 0
3 years ago
The knowledge and skills acquired by a worker through education and experience is a description of which factor of production? p
Marta_Voda [28]

Answer:

human

Explanation:

I took the test

6 0
2 years ago
Munster Company reports the following net cash in its statement of cash flows: net inflow from operating activities: $200; net o
Murrr4er [49]

Answer:

$170

Explanation:

Given the following information about Munster company:

Net inflow from operating ACTIVITIES = $200

Net outflow from investing ACTIVITIES =  $300

Net outflow from financing ACTIVITIES = $50

Ending balance in cash = $20

BEGINNING BALANCE :

Outflows + ending balance - inflow

(Outflow from investing ACTIVITIES + outflow from financing ACTIVITIES + ending balance in cash) - inflow from operating activities

($300 + $50 + $20) - $200

$370 - $200

= $170

3 0
3 years ago
The Food and Drug Administration (FDA) announced yesterday that they would approve a new cancer-fighting drug from Pharma Compan
Julli [10]

Answer:

the approval was already anticipated by the market

Explanation:

This abnormal return of 0% suggests that the approval was already anticipated by the market. Meaning that the price of the Pharma company's stock had already been affected by the speculation previously and when the FDA made the announcement investors had already made their move in the market with regards to Pharma's stock. Thus causing no further move and a return of 0% to occur.

5 0
3 years ago
Dr. Shetty is able to drive down the cost of complex medical procedures from $100,000 to $2,000 not by doing one big thing, but
melomori [17]

Answer:

C. Process Innovation.

Explanation:

As Dr. Shetty is able to drive down the cost of complex medical procedures from $100,000 to $2,000 not by doing one big thing, but rather by doing a thousand small things. This approach focuses on driving down the cost of healthcare through process innovation. Process innovation is the mechanism when we implement a new or significantly improved manufacturing method with the help of a new technology in order to remain competitive and meet consumers demands at the same time. We try to solve an already existing issue or reforms an existed process in a different way to generate something with huge benefits, likewise, same is the case here with Dr. Shetty who has reduced the cost of healthcare quite significantly just by changing and improving his production methods.

7 0
3 years ago
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