The U.S. fiduciary monetary system is one where money is not convertible to a valuable commodity such as gold.
Option a
<u>Explanation:
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In fiduciary monetary system, the money is issued by the government and the value of the money depends uniquely on faith of the public that the currency represents command over services and goods. The word fiducia is from Latin and it means trust or confidence.
Fiduciary money includes demand deposits of banks namely checking accounts. Fiduciary money is accepted depending on the trust its issuer commands.
The fiduciary currency is supplied in the economy by Fed. Fiduciary money can be classified into two categories namely,
- Paper money - Includes all the banknotes
- Divisional currency - Includes all the coins
Answer:
After-tax cost $652
Explanation:
$652 = $800 [1 − (0.5 × 0.370)]. Half of the interest is not deductible because it was used to purchase tax-exempt securities.
Answer:
Capital items; process materials; business devices.
Explanation:
Business strategy sets the overall direction for the business as it focuses on defining how a business would achieve its goals, objectives, and mission; as well as the funds and material resources required to implement or execute the business plan.
The information technology (IT) strategy is an integral part of the business strategy because it presents the technological or technical framework and infrastructure required to achieve a successful business plan, objectives, mission and goals.
In this scenario, Johanna is looking to set up a new drilling company. First, she would need capital items such as offices and heavy machinery.
Since she is starting from scratch she will need other things as well. The company will require process materials such as industrial glue and oils to run the machinery smoothly. Since the venture is new, she will need lots of help. The company will have to employ a legal team and a marketing team as part of the business devices that the company will require.
Answer:C
Explanation:
Discretionary fiscal policy is less effective than is implied by the early Keynesian view
Answer:
a) Re = Rf + [beta x (Rm - Rf)
10% = 5% + [1 x (Rm - 5%)]
5% = Rm - 5%
Rm = 10%
risk premium = Rm - Rf = 5%
b) Re = 5% + (1.5 x 5%) = 12.5%
c) Re = 5% + (0.7 x 5%) = 8.5%
since Re is lower than the expected return of the project, the NPV is positive.
d) 11.5% = 5% + (beta x 5%)
6.5% = beta x 5%
beta = 6.5% / 5% = 1.3
