Answer:
(a) $3,444,444.44
(b) $11,160,000
Explanation:
(a) Effective purchasing power:
= Loan amount ÷ (1 + cumulative inflation rate)
= $6,200,000 ÷ (1 + 0.80)
= $6,200,000 ÷ 1.80
= $3,444,444.44
Therefore, the effective purchasing power of the $6,200,000 is $3,444,444.
(b) Lender should be repaid:
= Loan amount × (1 + cumulative inflation rate)
= $6,200,000 × (1 + 0.80)
= $6,200,000 × 1.80
= $11,160,000
Answer:
The answer is D. first-dollar insurance coverage.
Explanation:
First dollar insurance coverage is a kind of insurance policy that has no deductible or copay, where the insurance company starts covering costs on the first dollar claimed, and in which the insurer assumes payment the moment an insurable event happens.
While there is no deductible, the amount that the insurer will pay out is often lower when compared with similar plans which have a deductible, or the premiums for the first dollar plan will be higher.
The return of equity will increase. Businesses can finance
themselves with debt and equity capital. By aggregating the quantity of debt
capital kin to its equity capital, a company can increase its return on equity.
The way in which rising financial leverage increases ROE is a
little less instinctive. One way to think about it is that if a business
adds debt, its assets increase for the reason that its
cash inflows from the debt issuance and so does its
entire debt.
Answer:
There is a positive adjustment of $5,200
Explanation:
Medical expenses
$2,500
State income taxes
$0
Charitable contributions
$5,000
Qualified housing interest
$6,000
Casualty loss
$1,800
Miscellaneous itemized deductions
$0
Total
$15,300
There is a positive adjustment of $5,200