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BartSMP [9]
3 years ago
11

You want to invest some money today to ensure you have exactly $50 thousand in 6 years to use as the down payment on a house. Yo

u are considering an investment in only one of the following bonds: (1) 3% 2-year T-Note; (2) 0% 6-year T-Bond STRIPS; (3) 3% 6-year T-Bond; (4) 5% 6-year T-Bond; (5) 8% 10-year T-Bond. The 6-year T-Bond STRIPS is the investment best suited to meet your objective. True False
Business
1 answer:
Naddik [55]3 years ago
5 0

Answer:

True

Explanation:

STRIPS are zero coupon bonds, and the advantage of them is that they allow an investor to know exactly how much money they will receive at a future date.

The investor purchases the STRIPS at a discount value, which we are not told here. E.g. assuming that the discount rate is 5% (similar to (4), the price of the STRIPS = $50,000 / (1 + 5%)⁶ = $37,311.

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Explanation: Operating income refers to the income that the company earns from performing its core operations. It is also denoted as EBIT. Thus, the difference between operating income and income after tax is the tax that has been deducted from the operating income.

While calculating accounting profit, opportunity cost is not deducted from the revenue hence before tax and after tax depicts the investments that were made to earn that profit.

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4 years ago
Aperture and shutter speed are separate entities that do not affect each other in any way.
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The following information is available for a company's utility cost for operating its machines over the last four months. Month
tia_tia [17]

Answer:

                          Machine hours (X)        Utility cost

       High                2,680                          8,100

        Low               <u> (740)</u>                           <u> (4,650)</u>

                              <u> 1,940 </u>                          <u> 3,450</u>

Variable cost per machine hour

= $3,450/1,940 hours

= $1.7784 per machine hour

Explanation:

Using high and low method, we will obtain the highest activity (machine hours) and the corresponding cost. We will also obtain the lowest activity and the corresponding cost. Thereafter, we will deduct the lowest points from the highest points. Finally, we will divide the difference in cost by the difference in machine hours in order to determine the estimated variable cost per machine hour.

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