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2 years ago

By diversifying, the risk of holding stock

Business

1 answer:

snow_tiger [21]2 years ago

8 0

Answer: Option C

Explanation: In simple words, diversification refers to the process in which the holder of a portfolio purchases and includes different types of securities with no or negative correlation between them. By doing so, the risk of the portfolio can be reduced but cannot be eliminated as the systematic risk due to the market inefficiencies cannot be eliminated.

It is evident that over the past two years stocks paid higher returns than bond due to the fact that globalization has increased the market for the companies leading to hoover share which further results in higher return for stock holders in comparison to bond holders who have a fixed return.

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In a certain jurisdiction caroline, who is earning $42,200, currently pays a flat percentage of 25% income tax. The tax authorit

NISA [10]

The amount of tax paid less by Caroline as per the new taxation policies will be $950 over her annual salary of $42,200 after the taxes are applied assuming deductions being made.

The calculation of tax saved by Caroline will be done on the basis of comparing the taxation rates of both the policies after taking the changes into account.

<h3>Calculation of tax savings</h3>

The formula for calculation of tax will be done as follows when the taxes are charged on flat basis under the old policy,

$\rm Income\ Tax= Salary\ x\ Rate\ of\ Taxation\\\\\rm Income\ Tax= 42200\ x\ {\dfrac{25}{100}\\\\\\\\\\\\\\rm Income\ Tax= \$10550$

The taxation for the first $20000 as per the new policy will be

$\rm Income\ Tax\ Threshold= 20000\ x\ \dfrac{15}{100}\\\\\rm Income\ Tax= \$3000$

Calculating further taxation,

$\rm Income\ Tax= 22200\ x\ \dfrac{30}{100}\\\\\rm Income\ Tax= \$6600$

So, total taxation as per the new policy will be $9600. Now comparing the taxation of old scheme with new scheme, we get,

$\rm Income\ Tax\ Savings= Old\ Taxation - New\ Taxation\\\\\rm Income\ Tax\ Savings=10550-9600\\\\\rm Income\ Tax\ Savings=950$

So, the total taxes saved are $950 when the taxation rate changes.

Hence, the correct statement is that tax savings of $950 is possible when the authorities change the taxation rates to such slab rates by Caroline.

Learn more about tax savings here:

brainly.com/question/2396701

6 0

2 years ago

Suppose there are 100 workers in the economy in which all workers must choose to work a risky or a safe job. Worker 1's reservat

Amiraneli [1.4K]

Answer:

The solution is explained in the explanation section below

Explanation:

Solution:

(a) In the economy there exist 100 workers. the wage of reservation to take risky job for worker 1 is $1 and $2 for worker -2. only 10 jobs is seen as risky.

The curve of supply is shown as upward which starts from 1, because the price of reservation for the first worker is 1 and 2 is for the second worker and it keeps going on like that.

The demand curve is seen as elastic in a perfect form, due to the fact that there are only 10 risky jobs.

The 10th worker price is $10, because is wage differential is $10

(b) The worker's altitude towards taking risky jobs has changed, because of the advertisement. the wage reservation is -10$ for the first worker and -$9 for the second worker.

Th jobs seen as risky is available are only 10

However, as a result of the campaign advertisement, the curve of supply moves down and the market equilibrium gets is gotten when the wage differential is -$1. most people on the daily basis dislike risk, but the market determines those risky jobs that will pay less than the safe ones.

3 0

3 years ago

"shoes international is a global nonprofit organization" that works with schools and various companies to donate shoes to childr

Phantasy [73]

Answer:

multinational organization

Explanation:

As it is a non-profit it is not a corporation and because, it made operations and transaction around the globe. Therefore, it should be considered multinational as it is not constraint within the frontiers of a single country.

The most famous multinational organization, are the christian organization like:

Catholic Charities U.S.A
The Salvation Army
The Young Men’s Christian Association (YMCA)

4 0

2 years ago

What is the biggest difference in who makes the contributions to 401(k) and IRA retirement plans?

allsm [11]

In a 401k the employer usually matches a percentage and if you are lucky dollar for dollar, where in an IRA it is does an an extra option with a set amount of money usually 2500 or more for each IRA contribution.

5 0

3 years ago

If Congress ends an investment tax credit that used to subsidize domestic investment, how would this affect the market for loana

marin [14]

Answer: Demand will fall, Interest rates will fall

Explanation:

The investment tax credit would have encouraged more companies to seek loanable funds in order to embark on investment opportunities because they would be taxed less. This increase in demand in the market for loanable funds would have led to rates rising to keep up with demand.

If Congress were to end this credit, the incentive to invest and avoid tax would be gone. Companies would therefore demand less loanable funds and with this drop in demand there will be a drop in interest rates as well to entice people to borrow at the lower rates.

3 0

3 years ago