Answer:
D. 8 percent interest for 9 years
Explanation:
We would use the formula future value formula below to determine which of the investment options would double her money:
FV=PV*(1+r)^n
PV is the amount invested which is $1000
r is the interest rate expected to be earned while n is the number of years First option:
FV=$1000*(1+6%)^3
FV=$1,191.02
Second option:
FV=$1000*(1+12%)^5
FV=$1,762.34
Third option:
FV=$1000*(1+7%)^9
FV=$ 1,838.46
Fourth option:
FV=$1000*(1+8%)^9
FV=$2000
Last option:
FV=$1000*(1+6%)^10
FV=$ 1,790.85
The number of units of developing country currency required to purchase a basket of goods and services in a developing country that costs one dollar in the US is given by Purchasing power parity. Thus the correct option is C.
<h3>What is Service?</h3>
Services are referred to as a type of goods that is offered to someone in terms of facilities like the one received in a restaurant or shopping mall. It is a type of commodity or product that is intangible in nature, one can only feel it.
When a country's money is convertible into another country's currency, the number of products and services that can be purchased in each country at the same price is equal. This is known as purchasing power parity.
So, Purchasing power parity determines how many units of an emerging country's currency are necessary to purchase a basket of products and services in that country that cost one dollar in the United States.
Therefore, option C is appropriate.
Learn more about Purchasing power parity, here:
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The complete question is
he number of units of developing country currency required to purchase a basket of goods and services in a developing country that costs one dollar in the U.S. is given by?
a. GNI price deflator.
b. Human Development Index ranking.
c. Purchasing power parity.
d. The exchange rate.
Answer:
Miranda's self-employment tax = $21,320
AGI income tax deduction = $10,660
Explanation:
Particulars Amount
Net Earnings from Self Employment $158,500
Taxable Self employment Earnings $146,374.75
(158,500*92.35%)
Social Security Tax ($137,700*12.4%) $17,074.80
Medicare Tax ($146,375*2.9%) $4,244.88
Self employment Tax = Social Security tax + Medicare tax
Self employment Tax = $17,074.80 + $4,244.88
Self employment Tax = 21,320
Taxpayer are allowed a deduction for AGI of 50% of self-employment tax.
= $21,320*50%
= $10,660
Answer:
9.09%
9.327%
Explanation:
For computing the weighted cost of capital first we have to determine the cost of preferred stock, cost of common stock and the after cost of debt is shown below:
The Cost of preferred stock is
= Preferred dividend ÷ market price of preferred stock
= $2.50 ÷ $25
= 10%
The cost of common stock is
= (Expected dividend ÷ market price) + growth rate
= ($1.50 ÷ $20) + 0.05
= 12.50%
And, the after cost of debt is
= Before cost of debt × (1 - tax rate)
= 0.08 × (1 - 0.35)
= 5.2%
Now the WACC is
= Weightage of debt × cost of debt + (Weightage of preferred stock) × (cost of preferred stock) + (Weightage of common stock) × (cost of common stock)
= (0.45 × 5.2%) + (0.05 × 10%) + (0.50 × 12.5%)
= 2.34 + 0.5 + 6.25
= 9.09%
In the second case, the WACC is
= Weightage of debt × cost of debt + (Weightage of preferred stock) × (cost of preferred stock) + (Weightage of common stock) × (cost of common stock)
= (0.30 × 5.2%) + (0.05 × 10%) + (0.65 × 12.5%)
= 0.702 + 0.5 + 8.125
= 9.327%
Answer:
net wortht -143,280.85
equivalent annual cost $ 24,932.98
Explanation:
We sovle for the present value of each annuity:
<em><u>The first three years:</u></em>
C 31,000.00
time 3
rate 0.08
PV $79,890.0066
<em><u>Then the second phase annuity:</u></em>
C 20,000.00
time 5
rate 0.08
PV $79,854.2007
NOw, we discount this as it is three years into the future
Maturity $79,854.2007
time 3.00
rate 0.08000
PV 63,390.8391
Total net worth:
79,890.0066 - 63,390.8391 = -143,280.85
The EAC will be the annuity which makes the Present work
PV 143,280.85
rate 0.08
time 8
C $ 24,932.983
