The law of supply states that

Bank A has a higher ROA than Bank B. Both banks have similar interest income to asset ratios and noninterest income to asset rat

iren2701 [21]

Answer:

A) I only

Explanation:

We can conclude that bank A will be more profitable than bank B since ROA is a measurement of profitability, and if the banks are operating in a similar manner (both interest income to asset ratios and noninterest income to asset ratios are similar), then the bank with the highest ROA is the most profitable one.

8 0

3 years ago

Lawrence Summers served as secretary of the treasury in the Clinton administration and as director of National Economic Council

babunello [35]

Answer:

A) taking the cost into account because money spent on pollution reduction is not available for other worthy activities.

Explanation:

The economic approach tries to find solutions for problems optimizing the use of economic resources, therefore reducing costs and increasing benefits for every dollar spent.

Resources are scarce and that includes everyone, from a normal individual, to the richest person in the world, or the richest country in the world. The economic approach states that we should all try to maximize the benefits we obtain while exchanging resources. For example, if we need to study for a text and we know that solving problems helps us to learn more than just reading, then we should spend more time solving problems than reading because that way we can increase our benefits.

The US government and every other government in the world works on a budget and the money it spends doing A, will not be spent doing B. So the government must decide which actions to take in order for maximizing the benefits of the population (i.e. choose between A or B depending on which causes the greatest common good).

4 0

3 years ago

What effect do rising input costs have on the price of a good.

Genrish500 [490]

Answer:

Explanation:

Inputs are the factors required for production to take place. They may include labor and raw materials. In economics, inputs are the four factors of production that include land, labor, entrepreneurship, and capital.

The final cost of a product is dependent on the costs of production. The cost of production is an aggregation of the cost of each input used in the production. For a company to stay in operation, it must meet all its production costs. These costs are spread to each unit produced. A high production cost will result in an expensive product. Should the cost of any of the input increase, then the overall cost of the products will rise.

4 0

3 years ago

Mary and John, a young couple, come to you asking for financial advice. They recently graduated and have found entry-level posit

dolphi86 [110]

a) The lump-sum investment means that the young couple, Mary and John, will invest the total sum of $54,000 (18 x $3,000) at the beginning of the investment period, which yields a future value worth $154,134.31 at the end of the 18-year investment period,

On the other hand, the annuity investment of $3,000 implies that Mary and John will invest $3,000 annually, which yields a future value worth $98,279.98 at the end of the 18-year investment period.

b) The advantage of the lump-sum investment strategy over the annuity investment lies in the total interest generated, which is also compounded over the years.

Interest compounding means that Mary and John would be earning interest on interest.

The disadvantage of the lump-sum strategy, which becomes the advantage of the annuity investment, is that Mary and John may not afford the lump-sum at the beginning of the investment.

c) Since Mary and John could only afford to invest $3,000 annually, they should go ahead with the annuity investment.

The recommendation of the investment strategy is based on the financial status of Mary and John at the beginning of the investment because they are:

Financially literate
Moderate risk-takers.

<h3>What is future value?</h3>

The future value of an investment is the value of the cash flows in a future period. The future values of each investment strategy can be determined using the following future value formula:

FV = PV (1+r)^{n}

FV = future value

PV = present value

r = annual interest rate

{n} = number of periods interest held

Alternatively, it can be computed using an online finance calculator as follows:

Data and Calculations:

Lump-sum investment:

N (# of periods) = 18 years

I/Y (Interest per year) = 6%

PV (Present Value) = $54,000

PMT (Periodic Payment) = $0

Results:

FV = $154,134.31

Total Interest = $100,134.31

Annuity Investment:

N (# of periods) = 18 years

I/Y (Interest per year) = 6%

PV (Present Value) = $0

PMT (Periodic Payment) = $3,000

Results:

FV = $98,279.98

Sum of all periodic payments = $54,000 (18 x $3,000)

Total Interest = $44,279.98

Learn more about lump-sum and annuity investments at brainly.com/question/16522689

4 0

3 years ago

A bond with a coupon rate of 5.16 percent and semiannual coupon payments matures in 12 years. The YTM is 6.37 percent. What is t

Karo-lina-s [1.5K]

Answer:

6.47%

Explanation:

The computation of effective annual yield is shown below:-

Annual YTM = 6.37%

Semiannual YTM = 6.37% ÷ 2

= 3.185%

Effective Annual Yield = (1 + Semiannual YTM)^2 - 1

= (1 + 0.03185)^2 - 1

= 1.03185^2 - 1

= 1.0647 - 1

= 0.0647

or

= 6.47%

Hence, the effective annual yield is 6.47% i.e come after applying the above formula

7 0

3 years ago