Answer:
$95 million
Explanation:
When the Feds buys securities, it is an expansionary monetary policy
Expansionary monetary policy : these are polices taken in order to increase money supply. When money supply increases, aggregate demand increases. reducing interest rate and open market purchase are ways of carrying out expansionary monetary policy
Required reserves is the percentage of deposits required of banks to keep as reserves by the central bank
Required reserves = reserve requirement x deposits
Excess reserves is the extra that it kept by banks
Money supply = deposit / total reserves
total reserves = 30 + 10 = 40%
total increase in money supply = $38 / 0.4 = $95 million
Answer:
5.65%
Explanation:
Last year a stock of $78.00 was bought
During the period of one year $2.70 was received in dividend and inflation averaged 3.2%
Today the shares was sold for $82.20
The first step is to calculate the nominal return
= ($82.20-$78.00+$2.70)/$78.00
= 6.9/78
= 0.0885×100
= 8.85%
Therefore, the approximate real rate can be calculated as follows
= 8.85%-3.2%
= 5.65%
Hence the approximate real rate of return on this investment is 5.65%
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Answer:
Option D. management estimates the amount of uncollectibles
Explanation:
When the company estimates the bad debts, reflects it in the balance sheet through a Debit entry in the Bad Debt Expenses againts the asset account Allowance for Doubtful Accounts as a Credit.
When the bad debt are confirm as uncollectible the loss is reflected in the Account Receivable as a Credit with the correspondent debit entry in the Allowance for Doubtful Accounts.
Answer:
SCC won't pay any tax
Explanation:
Their loss of $30,000 in year 1 will be unused and made available to counterbalance the total generated earnings in year 2.
The $20,000 earnings in year 2 can be used to counterbalance the whole taxable income; so, SCC will not pay pay tax. SCC will have a ($10,000) loss carryover available for year 3 and beyond
