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3 years ago

All but one of the following features characterizes desirable aspects of insurance arrangements.

Business

1 answer:

prohojiy [21]3 years ago

5 0

Answer:

The answer is: The insurer should be guaranteed positive economic profits.

Explanation:

The insurer (or insurance company) like any other company in the world, is not 100% sure they will make a profit from a business transaction.

For example, a person that takes a life insurance policy for $1 million might die due to an accident, and the insurance company will lose money with that specific client.

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Income Statement, Retained Earnings Statement, and Balance Sheet The amounts of the assets and liabilities of Glacier Travel Ser

pashok25 [27]

Answer:

Income Statement Dec. 31, 20Y6

Glacier Travel Service

Total revenue $900,000

- Wages expense ($425,000)

- Rent expense ($180,000)

- Utilities expense ($75,000)

- Supplies expense ($38,000 )

- Miscellaneous expense ($37,000)

EBIT $145,000

- Taxes ($30,000)

Net profit $115,000

4 0

3 years ago

For many years, college costs (including tuition, fees, and room and board) increases have been higher than the inflation rate,

arsen [322]

Answer: $23,888

Explanation:

The cost today for a freshman at a public university is $19,500.

Inflation is at 7% a year and the period is 3 years from now. It is best to use a future value formula:

= Fees * ( 1 + rate) ^ number of years

= 19,500 * ( 1 + 7%)³

= 19,500 * 1.225043

= $23,888

3 0

3 years ago

Investment X offers to pay you $6,900 per year for 9 years, whereas Investment Y offers to pay you $9,300 per year for 5 years.

Oliga [24]

Answer:

$44,955.10

$38,131.84

Explanation:

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Investment X

Cash flow each year from year 1 to 9 = $6900

I = 7%

PV = $44,955.10

Investment Y

Cash flow each year from year 1 to 5 = $9300

I = 7%

PV = $38,131.84

To find the PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

7 0

3 years ago

Vaughn Manufacturing has estimated that total depreciation expense for the year ending December 31, 2021 will amount to $591000,

natali 33 [55]

Answer:

$915,000

Explanation:

Because half of the depreciation expense, and the expense on bonuses has already been reported by June 30,2021 (the half of the year), only hafl of the total money spent on the two items will have to be reported for the interim income statement ended on December 31, 2021:

$591,000 / 2 = $295,500

$1,240,000 / 2 = $620,000

Now, we simply add up these two figures:

$295,500 + $620,000 = $915,000

5 0

3 years ago

The YTM on a 2 year zero coupon bond is 5% and the YTM on a 1 year zero coupon bond is 3%. What does the no-arbitrage condition

tresset_1 [31]

Answer:

$111.11 or 111.11% of face value

Explanation:

Assuming the face value of $100 for all bonds (without loss of generality)

If the two year coupon bond is repackaged as a one year zero coupon bond paying $12 after one year and another two year bond paying $112 after 2 years, the price of the two zero coupon bonds are given as

Price of one year Zero coupon bond = 12/1.05 = $11.43 (one year ZCB has YTM of 5%)

Price of two year Zero coupon bond = 112/1.06^2 = $99.68 (two year ZCB has YTM of 6%)

So, one can sell the repackaged bonds at a price = $11.43+ $99.68 = $111.11 or 111.11% of face value

7 0

2 years ago