Answer: Most tax breaks reduce taxable income, but reducing taxable income below zero does not reduce the tax bill.
Explanation:
Tax breaks can be used to reduce your taxable income sometimes all the way to zero. This however simply means that you don't have to pay income tax but does not mean that there won't be other taxes to pay.
Because of these additional taxes left to pay, a person will still pay certain taxes even if their taxable income is below zero. Tax expenditures therefore do not help much with a federal tax bill of zero.
<span>Answer : 13.19 %
Explanation: Convert the Effective Annual Return EAR to Annual Percentage rate as shown below:
EAR = [1 + (APR / n )]^ n â’ 1
APR = n [(1 + EAR)^ 1/ n â’ 1
where n= number of days in a year. Let us take it as 365, since daily compounding
given EAR =14.1% per year
so 365 *(1.141)^(1/365) = 13.19%</span>
Answer:
The correct t answer is A. They are directly related - the higher the level of risk, all else equal, the more attractive the asset.
Explanation:
When the risk associated aged with an asset is high, usually the reward derived from.such an asset tends to be higher as well. This make the asset more attractive and desirable.
Answer:
$8.22
Explanation:
Given:
Dividend for third year = $110 = 1.1%
Dividend for forth year = $110
Dividend for five year = $110
Increase dividend rate from 6th year = 3.2% = 0.032
Required Rate Return = 13.1% = 0.131
Dividend for the 6th year = Dividend of 5th year(1 + Increase rate) =
1.1(1+0.032) = 1.1(1.032) = $1.1352
5th year dividend price = 1.1352/(0.131 - 0.032) = 1.1352 / 0.099 = $11.4666
= $8.22