Answer:
If the interest rate is higher, to earn the same amount, she will need to invest a lesser amount of money.
Explanation:
Giving the following information:
Jessica invested $2,000 today in an investment that pays 6.5 percent annual interest.
The correct answer is:
She could have the same future value and invest less than $2,000 initially if she could earn more than 6.5 percent interest.
If the interest rate is higher, to earn the same amount, she will need to invest a lesser amount of money.
Answer:
$320.59 decrease
Explanation:
The computation of the change in the value is shown below:
As we know that
The Value of perpetuity is
= Annual inflows ÷ interest rate
Current value is
= $170 ÷ 0.082
= $2,073.17
And,
New value is
= $170 ÷ 0.097
= $1,752.58
Now change in value is
= $2,073.17 - $1,752.58
= $320.59 decrease
We simply applied the above formula
Answer:
Produce throughout the shorter term but depart the industries run if the circumstances don't start changing because the losses are incurred.
Explanation:
The given values are:
Gold sells,
Q = 50
Price,
= $5000
Total cost,
= $300,000
Fixed cost,
= $100,000
So,
⇒ 
⇒ 
($)
Now,
⇒ 
⇒ 
So that,
⇒ 
On substituting the values, we get
⇒ 
⇒ 
So the above is the correct answer.
Answer:
the question is incomplete, so I looked for a similar one:
Real estate commissions billed to clients amount to $4,000. Paid $700 in cash for the current month's rent. Paid $250 cash on account for office supplies purchased in transaction 2. Received a bill for $800 for advertising for the current month. Paid $2,500 cash for office salaries. Paid $1,200 cash dividends to stockholders. Received a check for $2,000 from a client in payment on account for commissions billed
<u>Income statement</u>
Service revenue $4,000
Operating expenses:
- Rent $700
- Advertising $800
- Office salaries $2,500 <u>($4,000)</u>
Net income $0
Accrual accounting recognizes both expenses and revenues when they occur, not when a cash flow is associated to them. E.g. even though only $2,000 were paid by clients, the whole $4,000 must be considered revenue.
Answer:
a. Shorten his portfolio duration
Explanation:
The best action to take in order to capitalize on expectations of increasing interest rates would be to shorten his portfolio duration. This is because an increase in the interest rate causes his portfolio value to decrease, yet if the duration of his portfolio is shortened then the change/decrease in value will be lesser than if done otherwise.
