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2 years ago

Assume the Expectations Hypothesis regarding the term structure of interest rates is correct.

Business

1 answer:

S_A_V [24]2 years ago

6 0

Answer:

2.5% is the current two years interest rate

Explanation:

If the first year interest rate is 2% and expected coming year interest rate is 3% based on the hypothetical projection which is believed to be correct, then the interests rate for the two years will be the average of the interest of the two years in focus which gives us:

Current IR = IR (yr 1) + IR (yr 2) / no of years

Current IR = 2 + 3 / 2 = 2.5

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Uchimura Corporation has two divisions: the AFE Division and the GBI Division. The corporation's net operating income is $11,500

HACTEHA [7]

Answer:

$114,100

Explanation:

Data provided:

corporation's net operating income = $11,500

FE Division's divisional segment margin = $80,100

GBI Division's divisional segment margin = $45,500

Now,

the total segment margin

= ( FE Division's divisional segment margin ) + ( GBI Division's divisional segment margin )

on substituting the respective values, we get

the total segment margin = $80,100 + $45,500 = $125,600

Thus,

the common fixed expense not traceable to the individual divisions will be calculated as:

= the total segment margin -corporation's net operating income

on substituting the respective values, we get

= $125,600 - $11,500

= $114,100

5 0

2 years ago

The world price of grapefruits is above the price that currently prevails in Cuba in the absence of trade. Assuming that Cuba is

shepuryov [24]

Answer:

B, B

Explanation:

If Cuba decides to open up trade with the world grapefruit market, the price of domestic Cuban grapefruit for consumers will Increase because the opening of trading with the world will decrease amount of grapefruit available for the people in Cuba thereby creating shortage which will lead to increase in price. Cuban exports of grapefruits will Increase by virtue of opening to the rest of the world.

6 0

2 years ago

Why is it important not to leave your personal information on a public computer?

Tom [10]

One reason that it is important not to leave your personal information on a public computer is identity theft.

If you are logged into a personal site on a public computer and the information is accessed by someone else you could have your identity stolen. A dishonest person could use the personal information to apply for credit in your name.

6 0

2 years ago

On January 1, 2021, for $17.9 million, Seashells Company issued 8% bonds, dated January 1, 2021, with a face amount of $19.9 mil

bearhunter [10]

Answer:

Cash A/c Dr. $796,000

Discount A/c Dr. $99,000

To, Interest Revenue 895,000

Explanation:

According to the scenario, computation of the given data are as follows,

Face value = $19.9 million

Issued bond rate = 8% annually or 4% semi annual

So, Cash = $19,900,000 × 4%

= $796,000

Issued bonds value = $17.9 million

Market yield = 10% annual or 5% semi annual

So, Interest revenue = $17,900,000 × 5%

= $895,000

So, Journal entries are as follows,

Jun.30,2021 Cash A/c Dr. $796,000

Discount A/c Dr. $99,000

To, Interest Revenue 895,000

(Being interest revenue on June30 is recorded)

5 0

2 years ago

Use the following Year 3 data: Other Selling and Administrative Expenses $ 1,052,000 Other Expenses 249,300 Sales Revenue 4,887,

Talja [164]

Answer:

$222,450

Explanation:

Computation of annual income statement for Kvass Inc. is shown below

Sales revenue

$4,887,000

Less:

Selling and admn expenses

($1,052,000)

Other expenses

($249,300)

Advertising and promotion expenses

($553,350)

Salaries and wages expenses

($2,527,800)

Income tax expenses

($167,350)

Interest expense

($114,750)

Net income

$222,450

8 0

2 years ago