<span>You are given Nigel's current balance of $668.47 in an account he has held for 15 years. Also you are given an initial deposit of $497. You are asked to find the simple interest rate on the account. You will use the simple interest formula, F = P(1 + rn) were F is the current balance, P is the principal amount deposited, r is the rate and n is the number of years.
</span>F = P(1 + rn)
668.47 = 497(1 + r(15))
r = 0.023 or 2.3%
Answer:
<em>a. A yield to maturity that is less than the coupon rate.</em>
Explanation:
If a coupon bond is selling at <em>premium</em>, this implies its current market price is higher than its par (face) value. But the coupon rate remains the same. So, since the price of bond has risen, the current market interest rate <em>(yield to maturity)</em> has to be less than the <em>coupon rate</em>. This is because the interest payment should be near about same or identical in case, when the bond is selling at premium and also in the case when the bond was selling at its par rate or value.
Hence, to arrive at around about the same interest payment, <em>all else constant, a coupon bond that is selling at a premium, must have a yield to maturity that is less than the coupon rate.</em>
Answer:
B
Explanation:
A currency appreciates when its value increases.
For example if $1 was exchanged for 50 pesos. After appreciation of the pesos, $1 would buy $25 pesos.
So more $2 would be needed to buy 50 peso after the appreciation when before the appreciation $1 was buying 50 pesos.
As a result Mexican goods would become more expensive to US consumers and the revenue earned by Mexican producers would increase
Answer:
$21,000
Explanation:
Calculation to determine Clampett, Incorporated's excess net passive income tax
Using this formula
Excess net passive income tax = ( Interest income + Dividends ) × Tax rate
Let plug in the formula
Excess net passive income tax = ( $60,000 + $40,000 ) × 0.21
Excess net passive income tax = $21,000
Therefore Clampett, Incorporated's excess net passive income tax will be $21,000
