Answer:
“Should” or “should not” depend on the cost rate of the option and the risk appetite of investors.
Explanation:
An option is a contract that allows investors to buy or sell instruments such as security, Exchanged Traded Fund or an index at a pre-determined price over a certain period of time.
If the option will cost the investor an additional $10,000 and it is the cost for an option of $10 million investment, then it cost only 0.1% additionally, but it can secure the position of this investment; then the investor should buy this option.
Vice versa, if the additional $10,000 is much more than expected profit, and even lower but significantly drop down the total profit of an investment; and the investor always wish to have a high profit regardless high risk; then he shouldn’t buy this option.
Answer:
Requirement: Prepare the entry to record the sales transactions and related taxes.
1. Date Account Titles and Explanation Debit Credit
Apr. 10 Cash $30,975
Sales Revenue $29,500
Sales Tax Payable $1,475
(To record Cash sales along with sales tax)
2. Date Account Titles and Explanation Debit Credit
Apr. 15 Cash $18,530
Sales Revenue $17,000
Sales Tax Payable $1,530
(To record Cash sales along with sales tax)
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<u>Workings</u>
- Total Sales along with sales tax = $18,530, Sales Tax Rate = 9%. Sales Tax Amount = 18530*(0.09/1.09) = $1,530
- Sales Without Sales Tax = $18,530 - $1,530 = $17,000
Capital structure increases the ability of the company to find new wealth- creating investment opportunities.
Answer:
cost of equity = 13%
Explanation:
With the info given, we will use cost of equity formula from Dividend Growth Model. THis is given by:
Where D_1 is the next year dividend or D_1 = D_0(1+g)
P_0 is current stock price
g is the growth rate
Since D_0 (dividend this year) is 4.20 and g = 6.4% or 0.064, we can calculate D_1:
Current share price is 68, so we can now calculate cost of equity:
Hence,
cost of equity = 13%
The Free Application for Federal Student Aid (FAFSA<span>) is used to calculate the Expected Family Contribution (EFC), a somewhat harsh measure of the family's ability to pay for college. The EFC is the sum of a student contribution and a parent contribution.</span>
