Answer:
The capital gain of the TIPS in dollars is $27.69
Explanation:
Given
CPI = 200.5 (Beginning of the Year)
CPI = 195.4 (End of the year)
% = 2.75
CPI Reference = 184.2
CPI Reference of 184.2 = $1,000 rate
Capital Gain is calculated by the difference in value at the end of the year value and at the beginning of the year.
End of the year value = 200.5/184.2 * ($1000)
End of the year value = $1088.49
Beginning of the year value =
= 195.4/184.2 * ($1,000)
Beginning of the year value = $1060.80
Capital Gain =$1,088.49 - $1,060.80
Capital Gain = $27.69
The correct answer is: [C]: "coinsurance" .
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Answer: <u>Memos omit a closing signature.</u>
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<u>(I took the test and this was the answer)</u>
Answer:
The correct answer to the following question is option E) 9.06% .
Explanation:
Here the cost of equity given is - 11.8%
Pre tax cost of debt- 6.9%
Tax rate- 35%
So the after tax cost of debt - 6.9% x 65%
= 4.485%
The debt to equity ratio - .6
So the weight of debt - .6 / ( 1 + .06 )
= .375
Weight of equity - 1 / ( 1 + .06 )
= .625
Weighted average cost of capital =
Debts cost x weight of debt + Equity cost x weight of equity
= 4.485 x .375 + 11.8 x .625
= 1.681875 + 7.735
= 9.06%
Money demand for transactions
