Answer:
expectations theory
Explanation:
Expectations theory is defined as the prediction of what short-term interest rates will amount to in future based on the current long-term interest rates on an investment.
The theory suggests or states that "an investor will earn the same amount of interest by investing in two consecutive one-year bond investments that in one two-year bond investment".
Simply put, the theory say that one can invest twice in a one year bond and still make the same interest rate as investing once in a two-year bond.
This theory helps investors to make profits faster and even higher through multiple investments on bonds.
Cheers.
Answer:
Premium, value
Explanation:
Premium Pricing Strategy: this a strategy used by companies to drive up the prices for their products. This strategy is used when customers can be convinced that a company will offer a higher value than its competitors.
For example, looking at the prices of a Rolls Royce Phantom and a Toyota, one costs $450,000 and the other costs $25,000, both will take you from your office to your house, but some customers will prefer to buy the Rolls Royce, this is because of the value the Rolls Royce offers.
Value: this is the worth or usefulness of something. Therefore, if a company can offer value for money, customers will be willing to pay.
Answer:
Rate of return is 16.11%
Explanation:
Dividend Valuation method is used to value the stock price of a company based on the dividend paid, its growth rate and rate of return. The price is calculated by calculating present value of future dividend payment.
Formula to calculate the value of stock
Price = Dividend / ( Rate or return - growth rate )
$54 = $6 / ( Rate or return - 5% )
Rate or return - 0.05 = $6 / $54
Rate or return - 0.05 = 0.1111
Rate or return = 0.05 + 0.1111
Rate or return = 01611
Rate or return = 16.11%
Answer:
The correct answer is letter "B": The statement presents the fallacy of composition.
Explanation:
The Fallacy of composition refers to a fallacy by which an individual believes that something is true just because part of the whole is true. Typically, this type of belief leads to mistaken conclusions because what might be right for one person does not necessarily is right for others.
Answer:
The total manufacturing cost per unit is $10.50
Explanation:
Material cost per unit = Total material cost / Equivalent units of Material cost
Material cost per unit = $60,000 / 10,000 = $6 per unit
Conversion cost per unit = Total Conversion cost / Equivalent units of conversion cost
Conversion cost per unit = $90,000 / 20,000 = $4.5 per unit
Total Manufacturing cost = $6 + $4.50 = $10.50 per unit
