Answer:
Michelin sells tires to Nissan to install on their 2019 Sentras that are produced and sold in the United States.
- Not included in the GDP since tires are a component of new cars, they are not a final product.
American consumers import $3.5 billion of woven apparel from Bangladesh.
- Included in the GDP as imports, which reduce total net exports (NX).
The U.S. government spent $523.1 billion on national defense.
- Included in the GDP as government spending (G).
Entrepreneur and Shark Tank investor Barbara Corcoran purchases 15% of Cousins Maine Lobster food truck company for $55,000.
- Not included int he GDP since sale of stocks or ownership stakes at businesses are not considered final goods or services.
Answer:
Journal Entry
March 1
Dr. Cash $4,550,000
Dr. Discount on Note Payable $450,000
Cr. Note payable $5,000,000
December 1
Dr. Interest Expense $450,000
Cr. Discount on Note Payable $450,000
Dr. Note payable $5,000,000
Cr. Cash $5,000,000
Explanation:
Note payable is document which is payable after a specific period of time.
Note Payable is recorded at the present value of the note face value. We need to discount the face value of the note first.
Interest on the bond = $5,000,000 x 12% x 9/12 = $450,000
On December 31 Interest expense will be recorded and Payment of Note is made.
Answer:
Your opportunity cost of attending a game compared with the opportunity cost facing a college student 10 years ago is:
A) higher, because more games are televised today.
Opportunity costs are the cost of choosing one alternative from another.
In this case, when college students attend college football games they are unable to do other activities, not only while they are at the stadium or going to the stadium, but they are not able to purchase other goods. The cost of those alternatives that are lost are higher now because many college football games are televised now, before if you wanted to see a game you had to go to the game. So a student is now able to watch the game while doing other activities, or saving money for buying something else.
Can this change in opportunity cost account for the decline in college football attendance?
B) Yes, because these changes increase the opportunity cost of watching football games in person.
Even though opportunity costs do not involve actual cash payments, they are still important and individuals do consider them when they are choose one option over another. E.g. imagine if you had to choose between spending a considerable amount of money by attending a game (ticket, gas, beverages, etc.) or watching that game on TV and buying a few clothes instead or going on a date, etc. What option would you choose?
Answer:
(A) 8.22%
(B) 7.5%
Explanation:
The first step is to calculate the average nominal return
Average nominal return= R1 + R2 + R3 + R4 + R5/5
= 16 +(-5) + 19 + 13 + 10/5
= 16-5+19+13+10/5
= 53/5
= 10.6%
(A) The average real return can be calculated as follows
= (1 + average nominal return)/(1+ inflation) -1
= (1+ 10.6/100)/(1+2.2/100) -1
= (1+0.106)/(1+0.022)-1
= 1.106/1.022-1
= 1.08219-1
= 0.08219 × 100
= 8.22%
(B) The average nominal risk premium can be calculated as follows
Average risk free rate= Nominal average t-Bill rate-inflation
= 5.3% - 2.2%
= 3.10%
Average nominal risk premium= average nominal return -average risk free rate
= 10.6% - 3.10%
= 7.5%
