Answer:
E. Invest in mutual funds.
Explanation:
Individual investors tend to have relatively small portfolios and are usually unable to realize economies of size. The best strategy is to pool funds with other small investors and allow professional managers to invest the funds. Here, a fund manager is hired to invest the cash the investors have contributed, and the fund manager's goal depends on the type of fund; a fixed-income fund manager, for example, would strive to provide the highest yield at the lowest risk.
Answer:
Marginal utility of the additional units will turn negative
Explanation:
As total utility has reached a maximum level, adding additional units of the same product will generate the total utility to decrease thus, the marginal utility of this additional products is negative as they made the utility of the consumer to decrease.
The diminish return theory state that:
The units increase utility at a decreasing rate and then, they reach a maximum of utility afterwhihc, additional units do not generate utility, they decrease it
Answer:
<u>Monthly housing payment 2,033.22</u>
Explanation:
We need to calculate the monthly cuota of the mortgage
It will be the cuota of a 30 year annuity at 7.5 rate
We should convert the year in month and the rate in monthly, because the payment are monthly.
time= 30 year so 30 x 12 = 360 months
rate = 0.075 / 12 = 0.00625 monthly
Present Value = 225,000
C = $1,573.23
Now we will calculate the propert taxes, insurance per month
2,050 / 12 = 170.83
530 / 12 = 44.16
1,573.23 + 170.83 + 44.16 + 245 = 2,033.22
Answer:
Total purchase value (Cost basis) = $105,770
Explanation:
Given:
Appraisal value = $132,970
Offer price = $154,091
Cash amount = $30,971
Notes payable = $22,282
Mortgage amount = $52,517
Find:
Total purchase value (Cost basis)
Computation:
Total purchase value (Cost basis) = Cash + Notes payable + Mortgage amount
Total purchase value (Cost basis) = $30,971 + $22,282 + $52,517
Total purchase value (Cost basis) = $105,770
Answer: Dividend of $100,000, Capital Gain of $100,000 and Tax Free Return on basis of $100,000
Explanation:
Longhorn Company reports current E&P of $100,000 in 20X3 and still distributed $300,000 to it's sole shareholder. Because it had $100,000 in current E&P, that is all it can declare as Dividends. For this reason, the shareholder will recognize $100,000 as Dividends.
The Shareholder has a basis of $100,000 in the stock of Longhorn. As a result of this, $100,000 of the Distribution will be termed a TAX FREE Return on Basis because he is receiving a return on his basis that is neither a dividend nor capital gain.
The remaining $100,000 will be considered a Capital Gain as it reflects a rise in his stock.
