I feel that the answer would be C as that would give it the most time to grow and build, but I have heard many times that IRA's can be better as far as tax. I would go with C, unless your class has specifically been leaning about IRA's.
Expansionary fiscal policy to prevent real GDP from falling below potential real GDP would cause the inflation rate to be _<u>higher</u><u>_</u>and real GDP to be <u>higher.</u>
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What is Expansionary fiscal policy ?</h3>
Expansionary fiscal policy can be defined as the type of fiscal policy in which government intend to increase the aggregate money supply while on the other hand cut or reduce the tax rate for the purpose of economy growth.
In a situation were real GDP fall below potential real GDP this tend to lead to increase in both inflation rate and real GDP.
Inconclusion the inflation rate will be _<u>higher</u><u>_</u>and real GDP will be <u>higher.</u>
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The items that describes what happens at the equilibrium price are:
Producers supply the exact goods that consumers buy.
Consumers have enough goods, at the given price.
Producers used their resources efficiently.
Equilibrium pricing is when the items demanded match the items supplied. When this happens, the demand and good available equal each other, hence, equilibrium. The pricing is exactly where it should be for consumers to want and purchase the good or service.
Answer and Explanation:
The ethical issues that occurs in the case when a corporate insider wants to purchase or sells in the firm where an individual works are as follows:
1. The information could be misuse
2. It would become unfair for the investors
3. The trust could be broke also it would create the discrimination with the other investors
4. The insider trading lowers the size of the market that ultimately decrease the volatility of the market
Answer: Price of stock at year end =$53
Explanation:
we first compute the Expected rate of return using the CAPM FORMULAE that
Expected return =risk-free rate + Beta ( Market return - risk free rate)
Expected return=6% + 1.2 ( 16%-6%)
Expected return= 0.06 + 1.2 (10%)
Expected return=0.06+ 0.12
Expected return=0.18
Using the formulae Po= D1 / R-g to find the growth rate
Where Po= current price of stock at $50
D1= Dividend at $6 at end of year
R = Expected return = 0.18
50= 6/ 0.18-g
50(0.18-g) =6
9-50g=6
50g=9-6
g= 3/50
g=0.06 = 6%
Now that we have gotten the growth rate and expected return, we can now determine the price the investors are expected to sell the stock at the end of year.
Price of stock = D( 1-g) / R-g
= 6( 1+0.06)/ 0.18 -0.06
=6+0.36/0.12
=6.36/0.12= $53