Positive externality is a benefit that is enjoyed by a third party as a result of business transaction. Third parties include any individual, property owner or an organisation or a resource that is indirectly affected. If a positive externality in consumption is present in a market, then the private benefit from a consumption will be different than the social benefit from consumption.
Answer:
B) False: since it is still a closely held C corporation, it cannot reduce its ordinary income through passive losses. If it hadn't been a closely held C corporation then it could have made the deductions.
Explanation:
Passive losses are losses resulting from financial activities, i.e. investments in other corporations where the investor doesn't participate in.
Passive losses cannot offset ordinary income, they must be matched against passive gains only. If passive losses exceed passive gains, they can be carried forward without limitation.
The only exception applies to C corporations that are not;
- closely held corporations or
- personal service corporations.
Qualifying C corporations can actually deduct passive losses from certain ordinary income.
Closely held C Corporations are corporations where during the last 6 months, 50% or more of its stock is owned by 5 or fewer investors.
Answer:
The type of savings you should make is a fixed term deposit
Explanation:
When we have unused capital and want to make it grow, it is a good alternative to earn money because, when we leave our money in a bank for a certain time, we will receive it together with an additional sum due to profitability, Our reward for leaving the money to the bank and not using it.
Answer:
A. €1,244,212.10
Explanation:
Contract Size Country U.S. $ equiv. Currency per U.S. $
£ 10,000 Britain (pound) $ 1.9600 £ 0.5102 interest APR
12 months forward $ 2.0000 £ 0.5000 rates
€ 10,000 Euro $ 1.5600 € 0.6410 i$ = 1 %
12 months forward $ 1.6000 € 0.6250 i€ = 2 %
SFr. 10,000 Swiss franc $ 0.9200 SFr. 1.0870 i£ = 3 %
12 months forward $ 1.0000 SFr. 1.0000 iSFr. = 4 %
The correct statement among the given is 'cost of equity is always equal to or greater than the cost of debt'
.
Option-c
<u>Explanation:
</u>
Debt on assets which are less likely to lose is secured more uncertainty leads to lower returns, hence lower costs. The risk of loss to equity holders also remains greater and not even assured against any collateral. In comparison to higher risk equity holders foresee higher returns.
This is why debt costs are higher. Such high risk will lead to higher equity costs than debt costs. To investors, equity costs would be returned on equity investment, and debt costs would be made as part of debt investment.
