Answer:
b) The company will incur a loss
Explanation:
The market rate at the time of issue = 9%, while coupon rate = 8%, it says bonds provide lesser return when compared to the market rate.
At end of year 2 market rate drops to 6% which is lower than the Bond's coupon rate. Which means the bond's providing high return when compared to the market. So, company to retire the bonds need to pay more than the par value.
As company should retire these bonds more than par value, the company incur a loss.
Option 'B is correct
The company incur a loss
The answer is "trade deficit would widen in that country".
A fixed exchange rate regime forces financial discipline on
nations and abridges price inflation. For instance, if a nation expands its
cash supply by printing more money, the expansion in cash supply would prompt price
inflation. Given fixed exchange rates, inflation would make the nation's
merchandise noncompetitive in world markets, while the costs of imports would
turn out to be more appealing in that nation. The outcome would be an
augmenting exchange shortage in the nation, with the nation bringing in more
than it sends out.
Answer:
The correct answer is B
Explanation:
The Schedule B (which is Form 1040), if any of the following conditions are applied:
1. Earned or have taxable interest of $1,500 or the ordinary dividends.
2. Received or collected the interest from the seller who financed mortgaged and the buyer have kept the property as the personal residence.
3. Received or have an accrued interest from bond.
So, In this situation, Robin is the one who earned $1,550 in the corporate bond interest. Therefore, the Robin is required to file the Schedule B as he has earned more than $1,500.
