All categories

3 years ago

Calculating the rate of return allows you to determine: ________.

Business

1 answer:

AnnZ [28]3 years ago

5 0

Answer:

The answer is C. If the investment is earning enough to meet or exceed your investment goals

Explanation:

Rate of return is calculated by dividing the return you receive on your investment by the initial cost of the investment and then by multiplying it by 100.

Simply, this shows you how much you've received out of the investment you made initially.

So, a 10% rate of return means you have received 1/10th out of the initial investment and that at this rate, it will take 10 years to cover the cost of the initial investment.

You might be interested in

An investment offers a total return of 15 percent over the coming year. Janet Jello thinks the total real return on this investm

Sonbull [250]

Answer:

6.78%

Explanation:

Data provided in the question:

Total return i.e nominal rate = 15% = 0.15

Real return = 7.7% = 0.077

Now,

Inflation rate = $\frac{\textup{1 + Nominal rate}}{\textup{1 + Real return }}$ - 1

on substituting the respective values, we get

Inflation rate = $\frac{\textup{1 + 0.15}}{\textup{1 + 0.077}}$ - 1

Inflation rate = [ 1.15 ÷ 1.077 ] - 1

Inflation rate = 0.0678

Inflation rate = 0.0678 × 100% = 6.78%

6 0

3 years ago

Which is the primary source of revenue for the federal government

soldier1979 [14.2K]

The three main sources of federal tax revenue are individual income taxes, payroll taxes, and corporate income taxes. Other sources of tax revenue include excise taxes, the estate tax, and other taxes and fees.

8 0

4 years ago

If the hourly wage of German workers is $6, the hourly wage of Canadian workers is $10, and German workers produce half as much

inessss [21]

Answer:

D) Canada since the cost per unit of output will be lower.

Explanation:

A German worker earns $6 per hour with a X productivity, we can assume X = 10 units, so the labor cost in Germany = $6 / 10 units = $0.60 per unit

A Canadian worker earns $10 per hour with a 2X productivity, we can assume X = 10 units, so the labor cost in Canada = $10 / 20 units = $0.50 per unit

Canadian direct labor is 20% more efficient than German labor.

6 0

3 years ago

The Raven Co. has just gone public. Under a firm commitment agreement, Raven received $15.90 for each of the 25 million shares s

Studentka2010 [4]

Answer:

22.38%

Explanation:

Raven corporation has just gone public

They received $15.90 for each 25 million shares that was sold

The first step is to calculate the net amount raised

Net amount that was raised= 15.90×25,000,000 = 397,500,000

397,500,000-860,000-330,000

= 396,310,000

Underwriter spread= 17.50-15.90

= 1.6 per shares

Total underwriter spread= per share spread× number of shares that were offered

= 1.6×25,000,000

= 40,000,000

Total direct costs= 40,000,000+860,000

=40,860,000

Indirect flotation cost= indirect cost+price appreciation

= 330,000+(19.40-17.50)×25,000,000

= 330,000+1.9×25,000,000

=330,000+47,500,000

= 47,830,000

Total flotation cost= 47,830,000+40,860,000

= 88,690,000

Therefore, the flotation cost as a percentage of funds raised can be calculated as follows

= 88,690,000/396,310,000 × 100

= 0.2238×100

= 22.38%

Hence the flotation costs as a percentage of funds raised is 22.38%

3 0

3 years ago

Place the three components of aggregate demand in order of relative size, starting with the one representing the largest compone

geniusboy [140]

Answer:

The order, in terms of relative size, will be as follows:

(b) Consumption

(a) Net Exports

Explanation:

The aggregate demand consists of the sum of four components which are government spending, consumption, investment and net exports.

Amongst which the consumption is the largest component of all, as it represents the total income spent by an individual or household on the goods and services in the economy. It's calculation is dependent of several factors such as disposable income, interest rates and future economic conditions.

Investment is the second largest component, after consumption, as shifts in it's value results in improvement/fall on the quality and quantity factors of production in the long run.

In terms of size when compared with the other components, the Net Exports stands as the smallest component. Practically due to the fact that it is calculated after deducting imports from exports.

6 0

4 years ago