Answer:
insiders can cheat the market.
Explanation:
They can do things on the inside to make a stock go up or down. this can be an advantage to buying in low and selling high. Elon Musk did something similar, (put this in your answer for a kick) as he used his social influence to lower his stock, by saying its "overpriced" making people sell it. when the stock fell, more investors used the buying in low strategy, and he split the stock to allow smaller investors to buy into the stock, giving him 8 BILLION dollars in one market day. (I LOVE THE STOCK MARKET, IF YOU WANT TO LEARN POST A COMMENT AND I WILL TEACH YOU A LOT!!)
Answer:
a. $51,840
b. $15,440
Explanation;
a. First find the excess fair-value allocation;
= Fair value of Nephew - Book Value
Fair Value = Uncle ownership + Non-controlling interest
= 672,000 + 168,000
= $840,000
Excess fair value = 840,000 - 806,000
= $34,000
Any excess fair-value allocations are amortized over a 10-year period;
= 34,000/10
= $3,400
The Income to be recognized will be reduced by this yearly amotization so the 2014 income recognized by Uncle would be;
= (Nephew income - Amortization) * Uncle ownership stake
= ( 68,200 - 3,400) * 0.8
= $51,840
b. Nephew Company also owns 30% of Uncle which means that they will receive 30% of Uncle dividends.
= 0.3 * 30,000
= $9,000
Added to their own income;
= 9,000 + 68,200
= $77,200
The Non-controlling interest owns 20% so the income they will recognise is;
= 0.2 * 132,100
= $15,440
Answer:
With 2% inflation during the next 10 years, an item that presently sells for 100 will cost 102 in 10 years' time.
Explanation:
However, if the predicted inflation rate of 2% happens year on year, then the cost of the item will become 121.90 (100 (1+ 2%)∧10), compounded annually. In itself, inflation is the decline of the purchasing power of a given currency over some period of time. It is a quantitative measure of the rate at which the decrease in the purchasing power of the selected currency occurs, and how this is reflected in the price level of a basket of selected goods and services in that economy over some period of time.
