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svetoff [14.1K]
3 years ago
10

The current spot price of a stock is $30 and the risk-free rate for all maturities (with continuous compounding) is 10% per annu

m. It is known that the stock will pay a cash dividend of $2 at the end of the first year and a cash dividend of $3 at the end of the second year. What is the three-year forward price of the asset
Business
1 answer:
JulijaS [17]3 years ago
8 0

Answer:

$34.74

Explanation:

Three year forward Rate = Spot Rate * e^(10%*3) -Dividend Year 1 *e^(10%*2) -Dividend Year 2 * e^(10%*1)

Three year forward Rate = 30*e^(10%*3) - 2*e^(10%*2) - 3*e^(10%*1)

Three year forward Rate = 30*1.3498588 - 2*1.2214028 - 3*1.1051709

Three year forward Rate = 40.495764 - 2.4428056 - 3.3155127

Three year forward Rate = 34.7374457

Three year forward Rate = 34.74

Thus, the three-year forward price of the asset is $34.74

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Suppose the tax rate on the first​ $10,000 income is 0​ percent; 10 percent on the next​ $20,000; 20 percent on the next​ $20,00
olasank [31]
  <span>Family A: marginal rate 20%, average rate 10%</span><span> 

Family B: marginal rate 40%, average rate 23% </span><span>

The marginal tax rate is the rate paid on the last dollar of income; this would be whatever tax bracket the family is in. The average price is the total tax divided by the total revenue. </span><span>

Family A: </span><span>
</span><span>
total income $40,000: this includes $10,000 at 0%, $20,000 at 10% (tax of $2,000), and $10,000 at 20% (tax of $2,000). The last rate paid is 20% so that is the marginal rate; the total tax paid is $4,000, divide that by $40,000 total income, that is the average rate. </span><span>

Family B: </span><span>
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total income $100,000: this includes $10,000 at 0%, $20,000 at 10% (tax of $2,000), $20,000 at 20% (tax of $4,000), $30,000 at 30% (tax of $9,000), and $20,000 at 40% (tax of $8,000). The last rate paid is 40% so that is the marginal rate; the total tax paid is $23,000, divide that by $100,000 total income, that is the average rate.</span>
5 0
3 years ago
Suppose the price elasticity of demand is relatively elastic and the price elasticity of supply is relatively inelastic in a spe
Rzqust [24]

Answer:

c. producers

Explanation:

Since it is given in the question that the price elasticity of demand is relatively elastic but the price elastic of supply is relatively inelastic but if the excise tax is imposed on the goods so the greater burden of the tax would be on the producers as the supply is inelastic so the producers could not changed much but if we compare to the consumers, the consumer could change the demand more than before due to the elastic in demand.

So, the correct option is c.  

7 0
3 years ago
which is the value of the work actually performed up to a specific point in time, is calculated by multiplying the TBC by the pe
bearhunter [10]

Answer:

The answer is EV (Earned Value)

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It is the value of the work actually performed, determining the earned value includes collecting data on the percent complete for each work package, then converting this percentage to a dollar amount by multiplying the TBC of the work package by the percent completed.

I hope these helps, if it does please give brainliest.

3 0
3 years ago
Last year, Mountain Top, Inc., purchased a coal mine at a cost of $900,000. The salvage value has been estimated at $100,000. Th
nydimaria [60]

Answer:

Journal entry to record depletion expense

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Accumulated depreciation $280,000 (credit)

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6 0
3 years ago
When the 4th quarter futa tax is not at least _____, the payment may be mailed at year-end with form 940.
Arisa [49]

When the 4th quarter futa tax is not at least $500,  the payment may be mailed at year-end with form 940.

<h3>What is tax?</h3>

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Learn more about tax, here:

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