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VMariaS [17]
3 years ago
10

The fundamental relationship between savings and investment spending in an economy is that: A. savings will increase as investme

nt spending decreases. B. investment spending and savings are always equal. C. investment spending promises higher financial returns than savings. D. savings will decrease as investment spending increases.
Business
1 answer:
Romashka-Z-Leto [24]3 years ago
8 0

The correct option is B

<u>Explanation:</u>

In an economy, planned investment spending is always equal to planned saving. If actual saving falls short of (exceeds) planned saving, then actual investment falls short of (exceeds) planned investment.

That is the other part of the saving paradox. If an economy produces too much, such that saving is greater than planned investment, inventory will build up, giving signal to producers to reduce output, to restore equilibrium. Such investment scheme is suitable only to communist countries. Keynes has another investment theory in his liquidity story. But investment theories are equally a posterior.

Therefore, Option B is correct

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Matching is:________.
Kay [80]

Answer:

A. It is a valuation method.

Explanation:

The matching principle is used to assign same costs with the same revenues. For example the inventory bought to make the product would be assigned like wise to assure the guideline of matching principle.

It is a valuation method.

It is used to evaluate the accounting procedures.

For example let us assume that we are selling candies. But the advertisement is run once the candies have been manufactured and sealed. So the matching principle states that the advertisement expenses to be included in the income statement having the corresponding stock of candies manufactured and sold.

5 0
3 years ago
A 6.75 percent coupon bond with 26 years left to maturity can be called in six years. The call premium is one year of coupon pay
kiruha [24]

Answer:

The yield to call  is 5.07%

Explanation:

The yield to call can be computed using the rate formula in excel,which is given as :=rate(nper,pmt,-pv,fv)

nper is the number of years to call which is 6 years

pmt is the annual interest coupon payable by the bond,which is :6.75%*$1000=$67.5

The pv is the current price at which the bond is offered to investors. i.e $1,135.25

fv is the price at the bond would be called in six years i.e par value+premium

par value is $1000

premium is $67.5

call price is $1067.5

=rate(6,67.5,-1135.25,1067.5)

rate=5.07%

8 0
3 years ago
Match each of the definitions that follow with the appropriate investment term.
Ilia_Sergeevich [38]

Answer:

F - QUESTION 1

B    - 2

E    -  3

I      - 4

A     - 5

H     - 6

G    -  7

C    -  8

J    -  9

D    - 10

8 0
3 years ago
One year ago, you bought shares of Aaon, Inc at $36.48 a share. You received a dividend of $1.62 per share last month and sold t
Pie

Answer: 12.88%

Explanation:

The following information can.be inferred from the question:

Purchase price of share = $36.48

Dividend = $1.62

Selling price = $41.18

Capital gain = $41.18 - $36.48 = $4.70

Capital gain yield:

= Capital gain / Purchase price × 100

= (4.70 / 36.48) × 100

= 0.1288

= 12.88%

7 0
3 years ago
A fully discrete whole life insurance policy paying $50,000 at the end of the year of death is issued to an individual age 36. T
DerKrebs [107]

Answer:

Our P = 17540 $

Explanation:

Amount of Insurance Policy = 50000$

premium reserve at 10th Year = 8000$

Net Premium for the policy = 900$

Annual Interest Rate = 6%

Net Premium at the age of 46 = ????

900 * 10 years = 9000$

9000 + Interest rate @ 6% = 9540$

Net Premium + Premium reserve of 10 Years = 9540 +8000 = 17540$

P = 17540 $

Note: As similar policy have interest rate @ 6%,which is paid every year,

At the age of 46, Net premium reserved amount also will be recovered.

6 0
3 years ago
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