Answer: $35.84
Explanation:
First year
10% compounded continuously is: 10.517%
$30 X 1.10517=$33.16, then take $2 for dividend and you get ($33.16-$2) $31.16 at the end of the 1st year.
Second year
10% compounded continuously is: 10.517%
$31.16 X 1.10517-2=$32.43 at the end of 2nd year.
(-2) is the dividend for the second year to be taken out.
Third year
10% compounded continuously is: 10.517%
$32.43 X 1.10517
=$35.84
Or:
The three year forward price is gotten by deducting the PV of the returns from the current price and then grossing up to get the returns for three years at the risk-free rate.
The present value of the income is 2e-0.1×1+2e-0.1×2= $3.447.
It is (30−3.447)e0.1×3 = $35.84
Answer:
C. a circular flow of influences
Explanation:
The free market system is an economic system in which the prices for products and services is decided by supply and demand without the intervention of the government. As this system is based in the supply and demand, this forces infuence each other which generates a circular flow of influence. According to this, the answer is that the free market is characterized by a circular flow of influences.
Little to none because it can be distracting
Answer:
a. retained earnings was overstated and liabilities were understated.
Explanation:
Since in the cash dividend is declared also the same is not recorded by the company
So this error would impact the two account i.e. retained earnings and the liabilities
In this, the retained earning is overstated and the liabilities were understated
Therefore the correct option is a.
And, the rest of the options are wrong