Answer: increases and the interest rate rises.
Explanation:
As a result of the increase in a demand for investment, entities will borrow more money from financial institutions in order to undertake these investments.
Investments will therefore rise as a result. Unfortunately, due to the increase in demand for loanable funds from financial institutions, interest rates will rise as well to show that demand is increasing faster than supply of loanable funds as posited by the law of demand and supply.
Answer:
2 cents
Explanation:
The spot price = $0.7000 = 70 cents, The forward rate = $0.6950 = 69.5 cents and the call option with striking price = $0.6800 = 68.00 cents
The annualized six month rate = 3 1/2 % = 3.5 %, therefore the rate = r/n, where n is the number of period per year = 2. Therefore r/n = 3.5% / 2 = 0.035 / 2 = 0.0175
The minimum price = Maximum (spot price - striking price, (forward rate - striking price) / (1 + 0.0175), 0) = Maximum(70 - 68, (69.5 - 68)/ 0.0175, 0)
Minimum price = Maximum (2 , 1.47, 0) = 2 cents
Answer:
a. Bonds payable Liability account
b. Equipment Asset account
c. Accounts payable Liability account
d. Salaries payable Liability account
e. Common stock Equity account
f. Retained earnings Equity account
g. Cash Asset account
h. Accounts receivable Asset account
i. Sales revenue Equity account
j. Inventory Asset account
Explanation:
All the assets account is debit in nature, so the equipment, cash, account receivable and Inventory accounts are debit in nature and these are classified as asset.
All the account with credit nature is either classified as Liability or Equity accounts. Equity accounts are common stock, retained earning and sales revenue. Liabilities accounts are bond payable, account payable and salaries payable.
Answer:
The break-even point measured in sales dollars is $8
