So the GDP is one of the primary indicators used to gauge the health of a country's economy.
It represents the total dollar value of all goods and services produced over a specific time period; you can think of it as the size of the economy.
SO with that, you can tell the economic health of an economy.
Answer:
C
Explanation:
The GDP or gross domestic product measures the market value of all goods and services produced in country in a specific period of time. This year GDP should not include the log-splitter because Sally purchased it five years ago. We should include this year purchases: new parts, gasoline, oil. Also, we should include the market value of the 2 hours she spent repairing the log-splitter if she paid someone to do it or if someone paid her to do it, because this is a service. But the problem suggests that she repaired her own log-splitter, then we should not include it this year GDP.
Answer:
Bond Price= $1,128.82
Explanation:
Giving the following information:
Time= 13*2= 26
Cupon= (0.069/2)*1,000= 34.5
YTM= 0.055/2= 0.0275
Par value= $1,000
<u>To calculate the price of the bond, we need to use the following formula:</u>
Bond Price= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]
Bond Price= 34.5*{[1 - (1.0275^-26)] / 0.0275} + [1,000/(1.0275^26)]
Bond Price= 634.88 + 493.94
Bond Price= $1,128.82
Answer:
ROE would have changed by 8.52%
Explanation:
First we calculate the current ROE using Dupont Equation which gives ROE as,
ROE = Net Income/Sales * Sales/Total Assets * Total Assets/Equity
or
ROE = Net Profit Margin * Total Assets Turnover * Equity Multiplier
- Current ROE = 10600/295000 * 1.4 * 1.75 = 0.0880 or 8.8%
The condition says that the net income could have increased to 20850 but other factors will remain constant. Thus, to calculate new ROE, we will calculate the new Net Profit margin but the total assets turnover and the equity multiplier will remain constant as sales assets and capital structure is not changing.
- New ROE = 20850/295000 * 1.4 * 1.75 = 0.17316 or 17.32%
- The ROE would have changed by 17.32 - 8.80 = 8.52%