Answer:
The answer is: Barb will earn more interest the second year than Andy.
Explanation:
The magic of compounding interest refers to the fact that the more frequently your money earns compounding interest, the bigger your balance will grow. Compounding interest adds earned interest into your account and then pays you an interest over the previous interest.
So Barb will earn more interest in the second year since the interest she earned in the firs year will gain more interest.
Answer:
a) Y = 500
b) Wages: 2.5
Rental price: 2.5
c) labor Share of output: 0.370511713 = 37.05%
Explanation:
if K = 100 and L = 100
Y = 500
wages: marginal product of labor = value of an extra unit of labor
dY/dL (slope of the income function considering K constant while L variable)
With K = 100 and L = 100
Y' = 2.5
rental: marginal product of land = value of an extra unit of land
dY/dK (slope of the income function considering K variable while L constant)
L = 100 K = 100
Y' = 2.5
c) we use logarithmic properties:
50 was the land while 10 the labor
2.698970004 = 1.698970004 + 1
share of output to labor: 1/2.698970004 = 0.370511713
Answer:
Following are the responses to the given points:
Explanation:
For point a:
Criteria I
Date: 1-1.2020 Debt Investments
cash
For point b:
Criteria II
Date: 31.12.2020 Interest Account receivable to pay
Debt Investments
rate of Revenue
31.12-2020 Fair Value Adjustment
Gain or loss - equity unrealized holding
for point c:
Criteria III
31.12-2021 Interest Account receivable to pay
Debt Investments
rate of Revenue
31.12-2021 Gain or loss - equity unrealized holding
Fair Value Adjustment
Please find the attached table.
Answer:
1) 22%
2) YES as the return in the investment is 12% while the average cost of capital in this case; is of 8% hence there is a gain above the minimum accepted return.
Explanation:
IRR = 12%
weighted-average cost of capital:
DEBT 80,000 x 5% = 4,000
EQUITY 120,000 x 10% =<u> 12,000</u>
VALUE 200,000 16,000
16,000 / 200,000 = 8%
This is called s<span>ubstitution in production</span>