The financial plan is a section of a business plan that is only shared with those who really need to know such as loan officials, lawyers & accountants.
Economists call GDP that uses constant, unchanging prices as
<u>Real GDP</u>
Explanation:
- Real gross domestic product (real GDP for short) is a macroeconomic measure of the value of economic output adjusted for price changes . This adjustment transforms the money-value measure, nominal GDP, into an index for quantity of total output.
- It is calculated using the prices of a selected base year. To calculate Real GDP, you must determine how much GDP has been changed by inflation since the base year, and divide out the inflation each year.
- Real GDP accounts for the fact that if prices change but output doesn't, nominal GDP would change.
- The real economic growth, or real GDP growth rate, measures economic growth as it relates to the gross domestic product (GDP) from one period to another, adjusted for inflation, and expressed in real terms as opposed to nominal terms
Answer:
Interest expense for the year: 33,590.33
Explanation:
face value $ 300,000
rate 9%
time 15 years
issued at $ 201, 136
discount: $ 98, 864
amortization per year under straight-line: the discount is equally distributed for each period
98,864 / 15 = 6,590.33
<u><em>interest expense per year:</em></u>
face value x rate + amortization:
300,000 x 0.09 + 6,590.33 = <em>33,590.33</em>
Answer:
D
Explanation:
They have more freedom now that their father is dead, but they are
not strong enough to act on it.
Answer:
The risk free rate (Rf) is 28,2%
Explanation:
We will substituting the portfolio expected return (Er) and the betas of the portfolio in the expected return & beta relationship, that is:
E[r] = Rf + Beta * (Risk Premium)
On doing this we get 2 equations in which the risk free rate (Rf) and the risk premium [P] are not known to use:
12% = Rf + 1 * (P - Rf)
9% = Rf + 1.2 * (P - Rf)
On solving first equation (of Portfolio A) for P(risk premium), we get:
12% = Rf + 1 * (P - Rf)
12% = Rf + P - Rf
(Rf and Rf cancels each other)
P = 12%
Now, on using the value of P in second equation (of Portfolio B), and solving for Rf (risk free rate), we get:
9% = Rf + 1.2 * (12.2% - Rf)
9% = Rf + 14.64% -1.2Rf
1.2Rf - Rf = 14.64% - 9%
0.2Rf = 5,64%
Rf = 5.64% / 0.2
Rf = 28,2%
So, the risk free rate (Rf) is 28,2%
