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2 years ago

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Why is investing important in an economy?

2 answers:

denis-greek [22]2 years ago

6 0

B. provide materials for work, business yanno allat good stuff, see when you invest in an economy there's room for growth because they have the financial funds they need to yanno expand !

katrin [286]2 years ago

6 0

Answer:

Why is investing important in an economy?

A.

prevents people from spending money on things they can’t afford

<em><u>B. </u></em>

<em><u>provides money for machinery, tools, and equipment for growth </u></em>

C.

offers interest rates that don’t change

D.

carries no risk of loss

E.

ties to the discount rate

Explanation:

#platofam

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Lincoln Park Co. has a bond outstanding with a coupon rate of 5.73 percent and semiannual payments. The yield to maturity is 6.7

Natalija [7]

Answer:

Bond Price= $1,774.05

Explanation:

Giving the following information:

Coupon rate= 0.0573/2= 0.02865

YTM= 0.067/2= 0.0335

The bond matures in 23 years.

Par value= $2,000

<u>To calculate the bond price, we need to use the following formula:</u>

Bond Price= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]

Bond Price= 57.3*{[(1 - (1.0335^-46)] / 0.0335} + [2,000/1.0335^46]

Bond Price= 1,334.76 + 439.29

Bond Price= $1,774.05

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2 years ago

Floyd Industries stock has a beta of 1.20. The company just paid a dividend of $.50, and the dividends are expected to grow at 6

Elanso [62]

Answer:

a. 6.7%

b. 12.0%

Explanation:

a. DDM

Dividende Discount Method is used to calculate the price of the stock using Dividend, rate of return and growth rate.

Return on equity = [ Dividend x ( 1 + growth rate ) / Price of stock ] + Growth Rate

Return on equity = [ $0.5 x ( 1 + 6% ) / $76 ] + 6%

Return on equity = [ $0.5 x ( 1.06 ) / $76 ] + 0.06

Return on equity = 6.7%

b. SML

Security Market line method uses calculates the cost of capital using following formula

Re = R f + β ( Rm − R f )

Rf = Risk free rate

β = stock beta

Rm = Market rate

Re =Expected rate

Re = 5.9% + 1.20 ( 11% - 5.9% )

Re = 12.02%

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3 years ago

If accounts receivable and inventories increased by $85,000 (total), accounts payable increased by $14,000, and depreciation add

scoundrel [369]

Answer:

We can't define the firm's net income without additional information as either (1) or (2):

1) Revenues/ all income, and all expenses

2) Operating cash-flow together with interest expense, and tax rate

Explanation:

If we can have the operating cash-flow, then we can define EBIT (profit/ earnings before tax and interest) as below:

Operating cash-flow = EBIT + depreciation - increase of accounts receivable and inventories + increase of accounts payable.

Assuming Operating cash-flow is $100,000 then we have:

EBIT = $100,000 + $64,000 - $85,000 + $14,000 = $93,000

Assuming the firm have no interest expense and tax rate is 35%, then net profit = EBIT*(1- tax rate) = $93,000 * (1-35%) = $60,450

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3 years ago

g Overhead costs are assigned to production using an overhead application rate, whereas no such "application rate" is used to as

Hoochie [10]

Answer:

Overhead costs are assigned to production using an overhead application rate, whereas no such "application rate" is used to assign the costs of direct materials and direct labor to production. The reason for this difference in procedures is that:

Overhead is an indirect cost which cannot be traced easily and directly to specific units of product.

Explanation:

Manufacturing overhead costs are not direct costs. They are not generally traceable to units of products. They include such indirect costs as Depreciation Expense, Property Taxes, Indirect Labor, Indirect Materials, etc. No unit of product can be ascribed such costs except as an approximation.

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3 years ago

Common uses of the statement of cash flows include all but which of the following?

Sphinxa [80]

Answer: Option D

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Cash flow statement is used by the management to evaluate the performance and for making plans for future. It is also used by potential investors for evaluation purposes.

Government do not need cash flow to asses ability of the company. The tax obligation on a company is calculated on its income which is shown by other financial statements like income statement.

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2 years ago