Answer:
should exceed the rising price level.
Explanation:
Inflation occurs when there is a general increase in prices of goods and services in an economy. The price of a basket of goods increases so the purchasing power of money is reduced.
For example when a gallon of petrol sells for $50 under inflation it can rise to $100. More money will be needed to buy the same amount of goods.
In this situation the rate of return of an investment will need to be above the rising price level to maintain a positive cash flow.
This is because value of money has reduced so returns needs to be higher to make positive cash flow.
Answer:
Alternative 1
Explanation:
We will choose the alternative one because it takes only five years to demonstrate the draft capability development document, and it uses advanced technology demonstrations. On the other hand, we can not choose alternative two because it will take three more years from alternative one to demonstrate the draft CDD.
Answer:
Cost of preferred stock
= <u>Perpetual dividend</u>
Current market price
= <u>$14.00</u>
$134.26
= 0.1043 = 10.43%
Explanation:
Cost of preferred stock is calculated as perpetual dividend divided by current market price. Cost of preferred stock is the minimum rate of return expected by preferred stock holder.
Answer:
D$138,000
Explanation:
We know that
Direct material used = Beginning balance of raw material inventory + purchase made during the year - ending balance of raw material inventory
$130,000 = $32,000 + purchase made during the year - $40,000
$130,000 = -$8,000 + purchase made during the year
So, purchase would be
= $130,000 + $8,000
= $138,000
Answer: $10,869.57
Explanation:
The Nominal GDP is the total amount of final goods and services produced in a country within a period, usually a year. It is calculated using the current year's prices.
Real GDP adjusts the Nominal GDP for price changes by using the price level of a certain base year.
The GDP Deflator is the price level of the current year and can be useful in calculating how much the prices have risen or fallen from the prices of the base year.
The formula is;
(Nominal GDP/Real GDP)*100 = GDP Deflator
Making Real GDP the subject;
Real GDP = (Nominal GDP/GDP Deflator)*100
= (10,000/ 92) * 100
= $10,869.57
