Answer:
c Financial institutions purchase the bonds, which removes money from the system and the interest rate rises.
Explanation:
The Fed engages in various strategies to control the amount of money in the economy. On each strategy is the Open Market Operations (OMO) where the Fed regulates cash in circulation by selling or buying of securities.
When the Fed sells treasury bonds they want to mop up cash in the economy and reduce money supply.
As financial institutions purchase the bonds the level of liquidity or cash in the economy reduces.
This will push interest rates up as financial institutions have less cash to lend to customers.
Answer:
Milton Friedman.
Explanation:
Milton Friedman is an American economist born on the 31st of July, 1912 in New York, United States of America. Milton is a Nobel laureate for his notable work on monetary history and theory, consumption analysis and the complexity of stabilization policy.
The idea that the mission of business is to produce goods and services at a profit, thus maximizing its contribution to society is associated with Milton Friedman.
This ultimately implies that, most business firms have a mission of producing goods and services that meets the need or requirements of the consumer, as well as generating profit to the business firm.
Answer:
determining the advertising budget
Explanation:
An advertising budget refers to the estimate of the advertising spending of a corporation over a specified period of time frame. More crucially, it is the cash a firm is capable of setting aside to achieve its advertising goals. In developing a marketing budget, a corporation should evaluate the importance of investing a dollar in ads against such a currency's value as known revenues.
The advertising budget is a part of the general revenue or market presence of a business that can be seen as the investment in the development of a product. The greatest marketing outlays — and initiatives — concentrate on the desires of consumers and solve their issues, not corporate problems like overstock cuts.
Answer:
Earning per share for the year 2016 is $2.68
Explanation:
For computing the earning per share, we have to use the formula of earning per share which is shown below:
= Net income ÷ total number of outstanding shares
where,
Net income is $937,500
And, the total number of outstanding shares equals to
= 2015 shares + 2016 shares
= 300,000 + 50,000
= 350,000
Now put these values to the above formula
So, the earning per share would be equals to
= $937,500 ÷ 350,000 shares
= $2.68
The earning after tax is not considered. Thus, it is ignored.
Hence, earning per share for the year 2016 is $2.68
Answer:
19.50%
Explanation:
In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below
Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)
For Stock R
= 3% + 2.5 × (13% - 3%)
= 3% + 2.5 × 10%
= 3% + 25%
= 28.00%
For Stock S
= 3% + 0.55 × (13% - 3%)
= 3% + 0.55 × 10%
= 3% + 5.5%
= 8.50%
The difference would be
= 28% - 8.5%
= 19.50%
