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melamori03 [73]
3 years ago
6

Why are capital appreciation bonds (CABs) a controversial way for local governments to finance projects?

Business
1 answer:
denis-greek [22]3 years ago
8 0

Answer:

See explanation section

Explanation:

Municipal security from which an investor will receive a return on investment from an initial principal is called a capital appreciation bond. However, in this security, the return on investment will be reinvested further until the security matures at a specific rate. The primary purpose of the CABs is to permit the local authority to generate revenue. Due to the financing in the innovative project without increasing the tax is one of the controversial ways for local governments to finance projects. Another controversial way is to owe investors more than what they acquired.

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Torino Company has 2,800 shares of $50 par value, 6.5% cumulative and nonparticipating preferred stock and 28,000 shares of $10
Feliz [49]

Answer:

The cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders is  $10,200.

Explanation:

In order to calculate the cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders is , we have to make the following calculations.

First, we have to calculate the Annual preferred dividend = (2800*50*6.5%) = $9,100

Hence, First year preferred dividend = $9,100-$8,000 = $1,100

Finally, if we make $1,100+$9,100 = $10,200 and so this will be the cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders.

8 0
3 years ago
A public good rev: 04_09_2018 Multiple Choice generally results in substantial negative externalities. can never be provided by
DochEvi [55]

Answer:

cannot be provided to one person without making it available to others as well.

Explanation:

A public good is a good that is non excludable and non rivalrous. It cannot be  provided to one person without making it available to others as well. If one person is using it, it does not stop other people from using it also. An example of a public good is roads.

Public goods contrasts with club goods and private goods

A club good is a type of public good. It is excludable but non-rivalrous. For example paid streaming services are an example of a club good. Those who do not subscribe are excluded from using the service. But all subscribers have equal assess to the service

A private good is a good that is excludable and rivalrous.e.g. a privately owned car

6 0
2 years ago
Journalize the December 31 adjusting entry required if the amount of unearned fees at the end of the year is $12,530. Refer to t
BlackZzzverrR [31]

Answer:

Dr Unearned fees $24,510

Cr Fees earned $24,510

Explanation:

Preparation of the December 31 adjusting entry required

Based on the information given if the balance shown in the unearned fees account was the amount of $37,040 before adjustment at the end of the year which means that if the amount of unearned fees at the end of the year is the amount of $12,530 the December 31 adjusting entry required will be :

Dr Unearned fees $24,510

Cr Fees earned $24,510

($37,040-$12,530)

7 0
2 years ago
I got called a street walker for this outfit,makeup and jewelry that i didn't even want to wear by my stepfamily when my cousin
yuradex [85]
You look like a burned victim
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3 years ago
A cut in tax rates effects equilibrium real GDP through two​ channels: ________ disposable income and consumer​ spending, and​ _
Paha777 [63]

Answer:

increases; increases

Explanation:

A cut in tax rate has numerous advantages and disadvantage to the economy both in long-run and short-run. A cut in tax rates increases the discretionary cash flow of people, which drives them to expand their utilisation spending. A cut in charge rates increment the size of the multiplier impact

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3 years ago
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