Answer:
D. today's dollars; purchasing power
The nominal value of anything is it's current price or the dollar amount someone is paying for it. For eg if the price of a kg of rice is $3, its nominal value is also $3. The real value is expressed in terms of purchasing power which means that the amount of goods and services that you can purchase from a particular amount of money today compared to a base year in the past. So for example if the base year is 5 years ago and the price of a kg of rice was $1.5, the real value of $3 would be 2 kgs of rice, where as currently if the price of a kg of rice is $3 then the real value of $3 is 1 kg of rice. As purchasing power decreases the real value of money decreases.
Explanation:
Answer:
<u>Advantages</u>
Dividends
These are payments to shareholders as a way to share the profits the company has accumulated.
This is an advantage to the issuing company because they are usually not under any obligation to pay Dividends with respect to common Equity. As a result profits can be plowed back into the company to increase profitability.
Repaid
This refers to the fact that shareholders do not have to be repaid for their investment like debt holders are. Stock Holders bought a piece of the company instead of loaning money to the company so they do not have to be paid back. This is an advantage because it frees up Cashflow for the company as well as allowing it to maintain a better credit rating due to lower debts.
Future Buy-Back
This is a clause inherent in most shares. It means that the Issuing company can choose to buy back the stock at a given time in future.
This is an Advantage because it allows the Issuing company to regain control of the company at a future date.
<u>Disadvantages</u>.
Shareholders
Shareholders are people or entities who buy shares in the Issuing company. As such, they are owners in the company and have voting rights on decisions that the company makes. This is a disadvantage because it means loss of Independence for the company who now legally have to take the opinions of shareholders into account.
Net Profit After Tax
This is money that the company has after paying off interests and then taxes. This is the money that the company retains. Having shareholders means that a company may have to pay shareholders from this amount instead of retaining all of it thereby making it at a disadvantage to the Issuing company.
One Vote per Share
This means that every shareholder has a vote for every share they hold in the company. This means that Shareholders therefore have a say in the affairs of the company. This is a disadvantage to the Issuing company because it means a loss of Independence for them when decisions need to be made.
Let us calculate net profit on each unit; after the changes, we have that the company sells 1300 units and eah unit has a profit margin of 175-100=75$.We also have that the fixed costs are in total 96000-20000=76000$. Consider the profit function P(x) that depends on the number x of units sold. P(x)=75*x-76000. Substituting x=1300, we have that P(x)= 97500-76000=21.500$. This is the Net operating Income after the changes.
Answer: actual level
Explanation:
It should be noted that when determining the standard overhead cost rate, overhead costs have to be grouped into the fixed cost and the variable costs.
The standard overhead applied is based on the actual level of activity multiplied by the predetermined overhead rate.
<h3>Hello there!</h3><h3>Answer: Receive the $189,000 today. It has a net value that's higher</h3>
The reason why you should receive the $189,000 today because it would have a net value that's higher than the second value.
When you get the $189,000, all of that money belongs to you, you don't have to worry about the discount rate of the property. The person that buys the property would be affected by the discount rate.
But for the second offer, you would apply the discount rate.
In the second offer, you're suppose to be getting $200,000. However, the discount rate will take away some of the money.
You would technically only get $182,000, meaning that you would be getting less than what you expected.
<h3>I hope this helps!</h3><h3>Best regards,</h3><h3>MasterInvestor</h3>
