Answer:
The debit balance for the vehicles account was $20,000, and the credit balance of accumulated depreciation account was $18,000.
- Dr Vehicles account 20,000
- Cr Accumulated Depreciation Vehicles account 18,000
then the van was sold for $2,000
- Dr Cash account 2,000
- Cr vehicles account 2,000
Since the carrying value of the van was $2,000 (= $20,000 - $18,000) and the van was sold for $2,000, Patel had no gain or loss from this transaction.
Answer: $1.43
Explanation:
To solve this, we would use the put call parity. We then calculate the value of the out which will be:
= $7.14 + $15/(1 + 5%) - $20
= $7.14 + $15/(1 + .05) - $20
= $7.14 + $15/(1.05) - $20
= $7.14 + $14.29 - $20
= $1.43
The price of an equivalent put option is $1.43
Answer:
See below
Explanation:
My grandmother is referring to the effect of inflation on the currency. Economist defines inflation as the general but gradual increase of prices in the economy over time. As a country experiences economic growth, prices of goods and services tend to increase. The government monitors the increase in prices using tools like the consumer price index (CPI). The resultant figure from the CPI is the inflation rate.
The government desires to keep the inflation rate at a predetermined optimal level. Should the economy grow at a fast pace, the inflation rate will probably rise. The government will respond with measures to control the growth and maintain stable prices.
An increase in prices means that the dollar will buy fewer goods and services than it could previously. A high inflation rate means prices are increasing at a fast pace. The dollar will buy fewer goods, which translates to dollar weakening.
Deflation is the opposite of inflation. It means a general decrease in price in the economy. During deflation times, the dollar gains strengths. It buys more goods and services than in the previous season.
