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3 years ago

the nominal interest rate is 7 percent and the expected inflation rate is 4 percent. the real interest rate is

Business

1 answer:

Hoochie [10]3 years ago

6 0

Answer:

2.88%

Explanation:

According to the fisher equation :

(1 + Nominal interest ) = (1 + real interest) (1 + inflation rate)

(1.07) = (1.04) x (1 + real interest)

(1.07) / (1.04) = (1 + real interest)

1.028846

real interest rate = 2.88%

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Which of the following expenses is NOT deductible when a taxpayer uses the simplified method of calculating the home-office dedu

Rasek [7]

The simplified method of computing home office expenses limits the number of home office expenses allowed to a fixed amount regardless of the amount of business income or the size of the home office.

<h3>How do you calculate home office deductions?</h3>

A business owner can calculate the home office deduction in two ways: regular and simplified. The regular method would require you to use Form 8829 to calculate your deduction, which would include figures for the area of your home and the total hours it was used for business purposes, your business income, and other business expenses.

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Learn more about home office deductions here:

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10 months ago

A $10,000 municipal bond with 10 years to maturity is purchased in the primary market at 105. The bond is sold after 2 years at

Mama L [17]

Answer: B. a 2 point capital gain

Explanation:

Municipal Bonds have to be amortized using the straight-line method and this applied to both newly issued or bonds being traded at a premium.

The bond in question is trading at 105 and so has a 5 point premium which needs to be amortized at 1 point a year for 5 years. As it was bought after two years, the amortization was 2 points which means the cost of the bond should be;

105 - 2 = 103

Yet it was sold for 105. The gain is therefore

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3 years ago

The inventory of Cullumber Company was destroyed by fire on March 1. From an examination of the accounting records, the followin

maria [59]

Answer:

a. Merchandise lost by fire value = $20,760

b. Merchandise lost by fire value = $25,770

Explanation:

Net sales = $51,000 - $1,100

= $49,900

Net purchase cost = $31,000 + 1,200 - $1,500

= $30,700

a. Gross profit = $49,900 × 40%

= $19,960

Cost of goods sold = $49,900 - $19,960

= $29,940

Cost of goods sold = beginning inventory + Purchases - ending inventory

= $29,940 = $20,000 + $30,700 - ending inventory

Ending inventory = $20,760

Merchandise lost by fire value = $20,760

b. Gross profit = $49,900 × 30%

= $14,970

Cost of goods sold = $49,900 - $14,970

= $34,930

Cost of goods sold = beginning inventory + Purchases - ending inventory

= $34,930 = $30,000 + $30,700 - ending inventory

ending inventory = $25,770

Merchandise lost by fire value = $25,770

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3 years ago

Which of the following factors will cause the long-run aggregate supply curve to shift to the right?

dlinn [17]

D.All of the above
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3 years ago

Independent auditing can best be described as:________. A. A regulatory function that prevents the issuance of improper financia

Elden [556K]

Answer:

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3 years ago