Answer:
DeBondt and Thaler (1985) found that the poorest-performing stocks in one time period experienced <em>good</em> performance in the following period and that the best-performing stocks in one time period experienced <em>poor</em> performance in the following time period.
Explanation:
DeBondt and Thaler carried out a study that examined stocks of 35 worst and best performing firms over a previous five-year period.The study showed that over the following three-year period, the firms that were previously performing poorly performed better than the former best performing firms, by an average of 25%.This reversal in the fortunes of stocks of firms in the following period is called the Reversal Effect.
Answer:
marginal analysis
Explanation:
it is believed that the rational man makes marginal analysis.
for example, a rational man would continue consumption up to the point that the marginal utility of the last bottle consumed equal marginal price.
If marginal utility falls below price, consumption should stop.
If marginal utility is above price, consumption should continue
Answer:
Explanation:
The journal entries are shown below:
a. Cash A/c Dr $15,000
To Games revenue A/c $15,000
(Being cash collected)
b. Cash A/c Dr $3,000
Accounts receivable A/c Dr $5,000
To Sales revenue $8,000
(Being cash received for selling of equipment)
c. Cash A/c Dr $4,000
To Account receivable $4,000
(Being cash received for merchandise sold by the company)
d. Cash A/c Dr $2,500
To Unearned revenue A/c $2,500
(Being deposit received for the upcoming fall season)
Answer:
$468,844 approx.
Explanation:
<u>Assumption</u>: <u>Since the question is incomplete, with the available information it has been construed that calculation of bond price is required and the question has been solved accordingl</u>y.
The price of a bond is the present value of future cash receipts it generates to the investor in the form of interest stream and principal stream.
wherein,
= price of bond as on today
i = annual coupon payments
ytm= investor's expectation of interest or market rate of interest on similar bonds
RV = Redemption value of such bonds assumed to be the face value
n = term to maturity
12.46221 × 22,500 + 0.376889 × 22,500 = 280,399.725 + 188444.5
$468,844 approx
This is the present value of the bond which is lower than it's face value because market rate of return of similar bonds is higher than the coupon rate of payment by Westside Corporation.
