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emmasim [6.3K]
3 years ago
8

A bond that pays interest annually yields a rate of return of 7.50 percent. The inflation rate for the same period is 2 percent.

What is the real rate of return on this bond?
Business
1 answer:
Jlenok [28]3 years ago
7 0

Answer:

5.39%

Explanation:

Given that,

Bond that pays interest annually yields a rate of return = 7.50 percent

Inflation rate for the same period = 2 percent

Real rate = [(1 + nominal rate) ÷ (1 + inflation rate)] - 1

Real rate = [(1 + 0.0750) ÷ (1 + 0.02)] - 1

               = (1.075 ÷ 1.02) - 1

               = 1.0539 - 1

               = 0.0539 or 5.39%

Therefore, the real rate of return on this bond is 5.39%.

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Down Under Products, Ltd., of Australia has budgeted sales of its popular boomerang for the next four months as follows:
laiz [17]

Answer:

Results are below.

Explanation:

Giving the following information:

Sales in Units

April 54,000

May 75,000

June 94,000

July 82,000

Desired ending inventory= 20% of the following month’s sales.

The inventory at the end of March was 10,800 units.

<u>To calculate the production for each month, we need to use the following formula:</u>

Production= sales + desired ending inventory - beginning inventory

<u>April:</u>

Sales= 54,000

Ending inventory= 75,000*0.2= 15,000

Beginning inventory= (10,800)

Total= 58,200 units

<u>May:</u>

Sales= 75,000

Ending inventory= 94,000*0.2= 18,800

Beginning inventory= (15,000)

Total= 78,800 units

<u>June:</u>

Sales= 94,000

Ending inventory= 82,000*0.2= 16,400

Beginning inventory= (18,800)

Total= 91,600 units

Total for the quarter= 228,600 units

4 0
3 years ago
The beginning inventory of BG Action Figures is understated by $7 million at December 31, 20x8. What is the effect on 20x8 cost
pogonyaev

Answer:

$7million understated

Explanation:

Based on the information given the effect on 20x8 COST OF GOODS SOLD will be UNDERSTATED by $7 million reasons been that since the OPENING INVENTORY IS UNDERSTATED by $7 million which means that the COST OF GOODS SOLD will as well be UNDERSTATED by the same amount based on the fact that opening inventory adds to Cost of goods sold.

8 0
3 years ago
Figure your taxable income, subtract the sum of lines 8 and 9 from line 7, and then enter that number here
Anna71 [15]

Answer:

22532

Explanation:

For this one you dont look at the w2 form. you have to look at the form you are filling out go up to question number 7 and 8 you will subtract those to answers that was filled in 34732-12200= 22532

sorry for the long explanation I was currently working on this and then I read the problem so many times but I feel slow so hope this helps

5 0
3 years ago
The main reason for considering nonconstant growth in dividends is to allow for _____ growth rates over _____.
JulsSmile [24]

Based on the economic and financial analysis, the main reason for considering <u>nonconstant growth</u> in dividends is to allow for "<u>Supernormal</u>" growth rates over "<u>some finite length of time</u>."

This is because, in nonconstant growth, the growth rate cannot surpass the mandatory return indefinitely.

However, there is the probability that it could do so for some number of years.

Also, it should be noted that in this situation, the value of the stock equates to the present value of all the future dividends.

Hence, in this case, it is concluded that the correct answer is <u>supernormal</u> and <u>some finite length of time</u>.

Learn more here: brainly.com/question/13223703

7 0
3 years ago
Interest Practice<br> How much would x dollars earn in 1 year at a rate of 4.4% compounded annually?
shusha [124]

Answer:

x1.044 - x

Explanation:

The formula for calculating compound interest is as below

FV = PV × (1+r)^n

where FV = Future Value

PV = Present Value

r = annual interest rate

n = number of periods

How much would x dollars earn in 1 year at a rate of 4.4% compounded annually?

In this case, PV =X, r =4.4% and n=1

FV = x  x ( 1+4.4/100)^1

Fv = x  x( 1.044)^1

Fv = x1.044

x dollars will earn x1.044 - x

8 0
3 years ago
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