What is the income threshold for self-employed workers to file a tax return.

Which of the following statements is CORRECT? a. If a company follows a policy of "matching maturities," this means that it matc

Butoxors [25]

Answer: d. Although short-term interest rates have historically averaged less than long-term rates, the heavy use of short-term debt is considered to be an aggressive strategy because of the inherent risks associated with using short-term financing.

Explanation:

Using short term financing is generally considered to be an aggressive strategy and is more often than not frowned upon by investors.

This is because of the reputational risk involved. A company that keeps using short term financing gives off the impression that it is barely keeping afloat and therefore relying on short term loans to continue functioning.

Other risks involved include, short term loans are usually given in small quantities so they cannot be used effectively as they will bareky go anywhere in terms of investment and their payback installment schedule can be in weeks instead of months like long term financing which can be detrimental to survival.

This is as opposed to a Conservative Approach that uses long term financing to finance most of it's Working Capital.

7 0

4 years ago

The next three annual dividends paid by XYZ stock are expected to be $2.79 in one year, $7.43 in two years, and $3.05 in three y

Vikentia [17]

Answer:

a. $49.83 (+ or - $0.05).

Explanation:

Given that :

Dividend of the first three years and the terminal value at the end of the year 2, that is the price at the end of year 2.

We know that the price of the share is the preset value of all the future dividends.

So we have to present price at the year 2 which is at present value for the end of the year 2 of the dividends beyond year 2.

To calculate the price of the stocks at present, we :

1. The present value for the price of the year 2 that is pv at the end of the year 2 of the dividend to be received beyond the year 2.

2. The present value of the dividend of the year 1 as well as year 2.

3. Then we add the steps 1 and 2 to get the present value of all the dividends.

Therefore,

The present value of the price at nth year with r rate of return is given by :

$\frac{\text{price at nth year }}{(1+r)^n}$

Hence, the present value of the price at the year 2 with 15.20% rate of return is = $\frac{54.78}{(1+0.1520)^2}$

$=\frac{54.78}{1.327104}$

= $ 41.28

Now present value of dividend of the first 2 years :

Dividend received at the end of the nth year with rate of return r is

= $\frac{\text{dividend}}{(1+r)^r}$

Therefore the present value of the dividend of the first two years is

= $\frac{2.79}{(1+0.1520)^1}+\frac{7.43}{(1+0.1520)^2}$

= 2.10 + 6.45

= $ 8.55

Now , $ 41.45 + $ 8.55

= $ 49.83

Thus, the current price of one share of the XYZ stock is $ 49.83

4 0

3 years ago

A mutual fund in which shares are issued only when the fund is organized is called a(n) __________ fund.

nadezda [96]

The answer is closed-end.

7 0

3 years ago

Redwood Corporation is considering two alternative investment proposals with the following data: Proposal X Proposal Y Investme

frez [133]

Answer :

Accounting rate of return = 0.0432 = 4.32%

Explanation :

As per the data given in the question,

Depreciation per year = (Cost - Salvage) ÷ Useful life

= ($810,000 - $10,000) ÷ 8 years

= $100,000

Annual Net income = Annual net cash flow - Depreciation

= $135,000 - $100,000

= $35,000

Accounting rate of return = Annual net income ÷ investment

= $35,000 ÷ $810,000

= 0.0432

= 4.32%

We simply applied the above formula

4 0

3 years ago

A price maker Group of answer choices faces a horizontal demand curve. is a seller that searches for good employees and pays the

Tatiana [17]

Answer: is a seller that has the ability to control to some degree the price of the product it sells.

Explanation:

A price maker is a firm with the ability to influence the market price of its goods or services.

Features of a price makers

1. They are usually monopolies

2. They have a downward-sloping demand curve

3 The goods they produce do not have perfect substitutes,

5 0

3 years ago