Answer: A. Government's borrowing to refinance the debt may lead to higher interest rates. Higher interest rates reduce investment spending, leaving future generations with a smaller stock of capital goods.
Explanation:
When the Government replaces a debt with another debt by means of Refinancing, they will probably be charged a higher interest rate because replacing debt with another debt is not generally ideal.
A higher interest rate means a higher repayment amount. Should the government keep paying higher and higher rates for debt, they'll have to reduce their spending on Investment. Investment creates Capital Goods such as machines and equipment. A reduction in Investment spending therefore reduces future generations' access to capital goods.
Answer:
The Heavy users of a business are those people who comprise about 20% of the business's consumers and yet buy so much that they bring in about 80% of the business's revenue.
Heavy users also have an impact on light users because they can market the goods to light users whether indirectly or directly when they use so much of a business's goods and services.
It is therefore very important that the business knows of these heavy users so that they can focus marketing strategies on them as well as to offer them incentives that will keep them satisfied and coming back for more because if they don't act and they lose their heavy users, their revenues will see a significant drop.
Answer:
Does the agreement specify that ownership of the asset transfers to the lessee? NO
Does the agreement contain a bargain purchase option? NO
Is the lease termequal to75% or more of the expected NOeconomic life of the asset? NO (4 < (.75 X 6))
Is the present value of the minimum lease payments equalto or greater than 90% of the fair value of the asset? NO
10,000 X 3.72325
= (37233 < (.9 X 44,000))
Annuity due : n=4, i=5%.
Does the agreement specify that ownership of the asset transfers to the lessee? NO
Does the agreement contain a bargain purchase option? YES
Is the lease termequal to75% or more of the expected NOeconomic life of the asset? Yes (4 > .75X5)
Is the present value of the minimum lease payments equalto or greater than 90% of the fair value of the asset? NO
35,456 < (.9 X 43,000)
10,000 X 3.54595
Ordinary annuity
n=4, i = 5%.
Answer:
you would be able to jump higher
you would be able to run quicker
you would be able to catch the ball better
Hope this helps!
