Answer:
The correct answer is option d.
Explanation:
In a perfectly competitive market, it is assumed that the buyers and sellers have perfect information and take their economic decisions accordingly. But in reality, buyers and sellers do not have perfect information.
Information comes at a cost, which can sometimes be high. The rational decisions of the consumers without full information can lead to irrational outcomes.
If the cost of gathering information is less than or equal to the benefit earned from the information, the consumers will gather information and make fully informed decisions.
But if the cost is higher than the benefits, the consumers will not gather information and make a less informed decision.
Hey stop think go smoke easy up on the pain the smoke a calm u down I'k it's hard but I take them points now thanks
Answer:
An investment with more liquidity would be ideal for someone who knows they will nee cash in the near future.
Explanation:
More liquid assets are those that can be turn into cash more quickly than those that less liquid assets.
If one is thinking about investing in a liquid asset, surely is because it will need the cash in the short run. On the contrary, we could invest in other financial instruments less liquid (typically those who offer higher yields and have longer terms), because we are not going to need the money for the moment, and we want to take advantage of that to get a higher yields.
Answer:
1. Ending Carrying value value in 2016 = legal cost for application which is $20,000
Ending Carrying value in 2017 = legal cost of application in 2016 + legal fees incurred in 2017 = $20,00 + $8000= $28,000
2. The company should not amortize the trade as it was not impaired in 2016 and 2017.
The trade name can be amortized if it's useful life is known above which the company has determined that it will not use the trade name anymore, then it will be amortized over it's useful life.
Answer:
Explanation:
Pretax cost of debt is the annual rate(YTM) of the bond. Using a financial calculator, input the following to calculate it;
N = 5*2 = 10
PV = -(95% *10,000,000) = -9,500,000
Coupon PMT = (6%/2)*10,000,000 = 300,000
FV = 10,000,000
then compute semiannual rate; CPT I/Y = 3.604%
convert to annual rate = 3.604*2 = 7.21%(this is the pretax cost of debt)
After tax cost of debt is calculated because interest payable on debt has tax shield. The formula is as follows;
Aftertax cost of debt = pretax cost of debt (1-tax)
AT cost of debt = 7.21% (1-0.40)
AT cost of debt = 4.33%
