Answer:
The market price of the security is $31.81
Explanation:
In order to calculate the market price of the security if its correlation coefficient with the market portfolio doubles we would have to calculate first the following:
First, calculate the dividend expected after one year with the following formula:
D=P*E(ri)
D=$50*0.14
D=$7
Next, we would have to calculate the beta of the security using the CAAPM Equation:
βi= E(ri)-rf/E(rm)-rf
=0.14-0.06/0.085
=0.9412
Next, we have to calculate the new beta due to the change in the correlation coefficient with the following formula:
β=correlation coefficient/σm*σs
=2*0.941
=1.882
Next, Calculate the new expected return as follows:
E(ri)=rf+βi(E(rm)-rf)
=0.06+(1.882)(0.085)
=0.22
Finally we calculate the new piece of the security as follows:
P=D/E(ri)
=$7/0.22
=$31.81
The market price of the security is $31.81
The income statement shows a detailed picture of the transactions of all revenue and expenses. The income summary account then summarizes these figures in order to produce the statement of retained earnings. Both the income statement and income summary show the revenue and expenses of a company.
Answer:
$395,000
Explanation:
Bad Debt expense:
= 1.5% of sales will be uncollectible
= 1.5% × $1,000,000
= 0.015 × $1,000,000
= $15,000
Allowance for Doubtful accounts:
= Bad Debt expense - accounts receivable written off
= $15,000 - $10,000
= $5,000
Net realizable value:
= Accounts receivable - Allowance for Doubtful accounts
= $400,000 - $5,000
= $395,000
Answer:
Variable
Explanation:
Given that, Variable is defined as a mathematical term that is often time used in business operation as well, to describe a form of value or cost that is not stable or permanent, which can change over a given period of time.
Hence, in this situation, the correct answer is " a VARIABLE is a measure, such as a price or quantity, that can take on different values at different times.
According to The American opportunity tax credit (AOTC<span>) Each student could </span>get a maximum annual<span> credit of $2,500 per eligible student.
So, </span><span>maximum education credit that emilio and lara can take on their return collectively is:
$ 2,500 x 2 = $ 5,000</span>
