All categories

3 years ago

Banks can create an unlimited amount of money. True or false, and why?

1 answer:

4 0

Could be true. Banks use the stored money to invest, and if they make the right investments, theoretically they can have excess in money, investing more with the excess, and this keeps happening.

You might be interested in

A south sea island produces only coconuts. In 2010, the price of a coconut is $1.50 and the quantity produced is 300. In 2012, t

Semenov [28]

1.50*300=$450
0.5*350=$175
(175/450)*100=39%
Real GDP in 2012 is 39%

8 0

3 years ago

Assume that you finance a new car when you graduate. It will cost $120,000 and you will finance it with a 84 month contract havi

shusha [124]

Answer: $1942.89

Explanation:

Since the car will cost $120,000 and it will be financed with a 84 month contract having a nominal rate of 9.20%, then the monthly payment will be:

= PMT(9.2%/12, 84, -120000)

This will be slotted into the Excel calculator and the answer gotten will be $1942.89

Therefore, the monthly payment will be $1942.89.

6 0

3 years ago

1. Which of the following events would make it more likely that a company would call its outstanding callable bonds? a. The comp

muminat

Answer:

The answer is letter C

Explanation:

Market interest rates decline sharply.

6 0

3 years ago

Universal Exports is expected to pay the following dividends over the next four years: $8, $4, $2, and $2. Afterwards the compan

tester [92]

Answer:

Maximum price to be paid for the stock = $12.43

Explanation:

The Dividend Valuation Model is a technique used to value the worth of an asset. According to this model, the worth of an asset is the sum of the present values of its future cash flows discounted at the required rate of return.

Hence the value of the stock would be the present value of its future dividend discounted at 15%

Year PV of dividend

1 8 ×1.15^(-1)

2 4 × 1.15^(-2)

3. 2 × 1.15^(-3)

4 2 × 1.15^(-4)

PV of dividend = (8 ×1.15^-1) + (4 × 1.15^-2) + (2 × 1.15^ -3) + (2× 1.15^-4) = 12.439

Maximum price to be paid for the stock = $12.43

4 0

3 years ago

Hart Company made 3,040 bookshelves using 22,040 board feet of wood costing $271,092. The company's direct materials standards f

kifflom [539]

1. a. The computation of the direct materials price variance is as follows:

= $2,204 ($12.20 - $12.30) x 22,040) Unfavorable

1.b. The computation of the direct materials quantity variance is as follows:

= $27,816 (24,320 - 22,040) x $12.20) Favorable

2. The direct materials variance that Hart will investigate further is the direct materials quantity variance, which is 10.3% ($27,816/$271,092 x 100) of the actual direct materials costs instead of the direct materials price variance, which is only 0.8% of the actual direct materials costs.

3. The journal entry to charge direct materials costs to Work in Process Inventory and record and close the materials variances are as follows:

a. Recording the Direct Materials Costs and Variances

Debit Work in Process $296,704 ($12.20 x 8 x 3,040)

Debit Direct Materials Price Variance $2,204

Credit Direct Materials Quantity Variance $27,816

Credit Raw Materials $271,092

To record the charge of direct materials to work in process based on standard cost.

b. Closing the Direct Materials Variances:

Debit Direct Materials Quantity Variance $27,816

Credit Direct Materials Price Variance $2,204

Credit Cost of Goods Sold $25,612

To close direct materials variances to the cost of goods sold.

Data and Calculations:

Units of bookshelves produced = 3,040

Feet of board used = 22,040

Cost of board feet of wood = $271,092

Per Unit Standard Actual

Price $12.20 $12.30 ($271,092/22,040)

Board feet 8 7.25 (22,040/3,040)

Learn more the computation of direct materials variances here: brainly.com/question/16048600

3 0

2 years ago