The effective interest rate for bond issuance in May, 2020 was 2.02%. Apple's interest expense related to the mentioned bond issuance is $171.7 million. Therefore, the effective interest rate charged was greater than 11%.
One coffee shop business in TX borrowed $3,000 and was scheduled to pay back $3,330 by paying 11% of its credit card receipts each day until $3,330 was paid in full. Average sales were $2,000, so the business paid Square $220 per day (2kx11%). It took the business 16 days to pay back the loan. The effective interest rate charged was greater than 11%. To calculate the interest expense, we need to multiply the bond's face value by the effective interest rate. Apple's interest expense = 2.02% x $8.5 billion = $171.7 million.All of the above options are correct reasons why Apple issued bonds instead of borrowing money from the bank.To find the effective interest rate charged, we need to use the following formula: Effective interest rate = (Total interest paid / Total amount borrowed) x (365 / Loan term in days)Total interest paid = $3,330 - $3,000 = $330.Total amount borrowed = $3,000.Loan term in days = 16. Substitute these values into the formula: Effective interest rate = ($330 / $3,000) x (365 / 16) = 28.98%. The effective interest rate charged was greater than 11%.
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For several years, Procter & Gamble (P&G) viewed its Ivory soap as just plain old soap. P&G focused on how well it made Ivory soap and not on what customers wanted from a bar of soap. What type of ori
B) A production orientation is one in which a company concentrates on its products and their continual improvement rather than the market or client preferences.
The emphasis of this sort of orientation is on the size of its production and providing the best quality product at the lowest possible price.
Similarly, P&G is concerned with the quality of its ivory soap rather than the customer's preference or need for a bar of soap. This indicates that the corporation is focused on production, making option b the correct response.
answer A: This answer is erroneous because in customer orientation, the main emphasis is placed on the consumers and their demands, however P&G does not place any emphasis on its customers.
Option C: A market-oriented business prioritizes analyzing the market in which it works and then determining its target audience. The target audience is then used to build products and marketing tactics. This means that option c is not an appropriate response in this case.
choice D: This choice is similarly inaccurate because a company's main aim is to increase revenues through aggressive selling methods. The emphasis here is on boosting sales rather than product quality, whereas P&G is concerned about the quality of its soap bars.
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Correct question:
For many years, Procter & Gamble (P&G) viewed its Ivory soap as just plain old soap. P&G focused on how well it made Ivory soap and not on what customers wanted from a bar of soap. What type of orientation did the company have?
A) customer
B) production
C) market
D) sales
Promissory Note
Staten Island, New York March 18
Sixty days after date, I promise to pay to the order of
Mitch Hanson / $750,000
Seven hundred fifty thousand, and 00/100 Dollars with interest at 10% per year
Payable at First Nations Bank, Cincinnati OH
Due May 17 Thomas James
Determine the following:
Maker or payer of the note
Lender
Term
Face Value
Promissory note: Maker or payer of the note: The maker of the note is Thomas James.Lender: The person or entity who is lending the money is Mitch Hanson.
Mitch Hanson will receive the amount mentioned in the promissory note from Thomas James after 60 days of the issuance of the note.Term: The term of the promissory note is 60 days. It will become due on May 17th.Face Value: The face value of the promissory note is $750,000. Therefore, Thomas James will have to pay $750,000 along with 10% interest to Mitch Hanson on May 17th.
The promissory note is a written promise by one party to pay a certain sum of money to another party. This note specifies the terms and conditions, such as the amount of the loan, the interest rate charged, the date of repayment, and the person or entity who is liable for the debt.Thus, the promissory note in this case specifies that the maker of the note is Thomas James, the lender is Mitch Hanson, the term is 60 days, and the face value of the note is $750,000.
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Is it better to pay off credit debt or create an emergency fund? Why?
Answer:
“Every single day your high-interest debt goes unpaid, it's costing you money — a LOT of money — in interest,” Krawcheck says. Instead of putting your extra cash toward an emergency fund, she suggests that focusing all of it on credit card debt first will save you more in the long run.
Explanation:
cnbc.com/select/pay-off-credit-card-debt-or-save-for-emergency-fund/#:~:text=“Every%20single%20day%20your%20high,more%20in%20the%20long%20run.
gail used broker bob as a buyer's agent when she was interested in buying a townhome last year. she gave up that idea when she realized that she would prefer the privacy of a free-standing home. this year, she is interested in making an offer on a home that bob has listed. can bob reveal what he knows about gail's exemplary credit history to the seller?
Bob cannot reveal Gail's creditworthiness to the seller of the property she is interested in buying. He has a duty to maintain confidentiality as a buyer's agent and should only disclose information that is relevant to the sale of the property.
No, Bob cannot reveal what he knows about Gail's exemplary credit history to the seller. Bob was acting as a buyer's agent for Gail last year and is currently the listing agent for the property that Gail is interested in buying this year.
As a buyer's agent, Bob had a fiduciary responsibility to Gail, which included the duty of confidentiality. He is not allowed to disclose any information about his clients without their permission, except in a few exceptional circumstances. Even though Gail is now interested in making an offer on a home that Bob has listed, he still has to maintain confidentiality.
Bob can reveal only what he knows about the property and the seller, not Gail's financial information. His duty to the seller is to get the best possible price for the property. Revealing Gail's creditworthiness can benefit the seller, but it is not ethical or legal.
It would violate the Code of Ethics for Realtors, and it could also subject him to legal action. Moreover, it is not in Gail's best interest to have her private information disclosed without her permission.
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In which scope management process we develop the work packages? O • WBS O • Validate scope Control scope Define scope
The scope management process where we develop the work packages is Define Scope.
What is the Define Scope Process?The Define Scope process is the method of establishing a defined, complete, and clear description of the project and product. Project requirements are defined in detail in this process, and the project deliverables are identified.
This phase is sometimes referred to as the scope definition, and it is frequently followed by the Work Breakdown Structure (WBS) development stage. This stage's major output is the Scope Statement.
The scope statement establishes the project's overall objective and specifies the deliverables that will be produced as a result of the project. In addition, the scope statement also sets out the project's limitations and exclusions, which are important in controlling project scope
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Interest rates increased continuously during the 1970s. the most likely explanation is:
During the 1970s, interest rates increased continuously. One possible reason for this is the rise in inflation and the government's efforts to control it. The high inflation rate was triggered by several factors, including the oil crisis, high government spending, and the Vietnam War.
As the inflation rate rose, people started demanding higher wages, which increased the cost of production. The businesses were forced to raise prices to maintain their profit margins. This created a vicious cycle of increasing inflation, prices, and wages. To combat this, the government raised interest rates to control the money supply and reduce the demand for goods and services.
Higher interest rates make it more expensive to borrow money, so people and businesses are less likely to borrow and spend. This helps to slow down the economy and reduce inflation. However, this also leads to higher unemployment as businesses are less likely to hire new workers or invest in new projects.
This can have a negative impact on the overall economy. Nonetheless, increasing interest rates is still considered an effective tool to control inflation, and it continues to be used by governments around the world to this day.
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Ava wants to purchase a new car. She has saved $9,000 for a down payment for a new car. She knows that she can afford to pay $12,000 per year and that her bank will charge her 5.75% interest on the car loan. She intends to pay off the car in 5 years. Interest will be compounded annually. Of the following, which is the most expensive vehicle in her price range that she could consider? (HINT: Don't forget the amount of the down payment that Ava has saved.)
A. A Mercede selling for $53,015.
B. A BMW selling for $58,500.
C. An Audi selling for $50,500.
D. A Tesla selling for $48,100.
Ava wants to purchase a new car, and she has saved $9,000 for the down payment. She knows she can afford to pay $12,000 per year, and the bank will charge her 5.75% interest on the car loan.
The interest will be compounded annually, and she intends to pay off the car in 5 years. So, let's find out the most expensive vehicle in her price range that she could consider by calculating the total cost of each vehicle. So, the formula to calculate the total cost is:T = DP + (PMT × n) + I Here, DP = Down payment PMT = Annual Payment I = Total Interest, and n = Number of years For Mercede, the total cost is:T = 9000 + (12000 × 5) + I For BMW, the total cost is:T = 9000 + (12000 × 5) + I For Audi,
the total cost is:T = 9000 + (12000 × 5) + IFor Tesla, the total cost is:T = 9000 + (12000 × 5) + INow, let's calculate the total interest for each vehicle using the formula: I = P × (r/100) × there, P = Principal (amount of the loan)r = Annual interest rate t = Time period in years For Mercede, the total interest is: I = 53015 - 9000 = 44015P = 44015r = 5.75%t = 5 years I = 44015 × (5.75/100) × 5 = $12,659.31For BMW, the total interest is:I = 58500 - 9000 = 49500P = 49500r = 5.75%t = 5 years I = 49500 × (5.75/100) × 5 = $14,292.19For Audi, the total interest is:I = 50500 - 9000 = 41500P = 41500r = 5.75%t = 5 years I = 41500 × (5.75/100) × 5 = $11,963.44For Tesla, the total interest is:I = 48100 - 9000 = 39100P = 39100r = 5.75%t = 5 years I = 39100 × (5.75/100) × 5 = $11,271.56Now, let's substitute the value of I for each vehicle in the total cost formula. T = 9000 + (12000 × 5) + 12659.31 = $81,659.31T = 9000 + (12000 × 5) + 14292.19 = $83,292.19T = 9000 + (12000 × 5) + 11963.44 = $80,963.44T = 9000 + (12000 × 5) + 11271.56 = $80,271.56So, the most expensive vehicle in her price range that she could consider is B. A BMW selling for $58,500.
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What is the difference between income and wealth? Which would have a higher Gini coefficient, income inequality in the United States or wealth inequality in the United States ? Briefly explain .
Find and share some statistics that you find interesting. What do you learn from these statistics? What questions do these statistics raise? Housing investments are one way to build intergenerational wealth.
Income and wealth are two separate concepts that refer to the financial well-being of an individual. Income refers to the money earned from work or investments, while wealth refers to the total value of a person's assets minus liabilities. Below are the differences between income and wealth:
The difference between income and wealth is the amount of money earned through work or investments over a period of time.
Interesting statistics related to income and wealth inequality in the United States:
1. The top 1% of households in the United States own more wealth than the bottom 90% combined.
2. The median income for Black households is less than 60% of the median income for white households.
3. The top 1% of earners in the United States earn more than 40 times the average income of the bottom 90% of earners.
4. In 2019, the average CEO in the United States earned 320 times the average worker's salary.
These statistics demonstrate the significant income and wealth inequality in the United States. There is a vast difference between the top earners and the bottom earners, and minorities are disproportionately affected by this inequality.
It raises questions about the effectiveness of current policies in reducing income and wealth inequality, and whether there is a need for more redistributive policies to address this issue.
Housing investments are one way to build intergenerational wealth because it provides a tangible asset that can increase in value over time. However, not everyone has equal access to housing investments due to systemic barriers such as discrimination in the housing market. These barriers contribute to the widening wealth gap in the United States, where only a few individuals can benefit from these investments.
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If you were the holder of a call option (having cost you $2) on some stock with an exercise price of $20, it would be best for you to exercise your option when the market price is at Question 11 options: a) $18 b) $20 c) $22 d) $24
If you were the holder of a call option (having cost you $2) on some stock with an exercise price of $20, when the market price is at 22.
This is because exercising the option at the market price of $22 would result in a profit of $0, as opposed to exercising at any other market price, which would result in a loss.
If the option were to be exercised at a market price of $18, it would result in a loss of $2, a profit of $0 at a market price of $20, and a profit of $2 at a market price of $24. Due to this, $22 is the optimal market price at which to exercise the option.
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Prepare a TOWS Matrix sheet by selecting 1 strategy and 1 business.
Needed ASAP. Please help me doing this. Upvote will be
provided.
Select ONE strategy and ONE business and develop a TOWS matrix: Strategy: Business/Company Chocolate Manufacturer Supermarket Local Bank College Mobile investment app Restaurant Growth Expansion Marke
A TOWS matrix is a strategic management tool that can be used to identify and evaluate different internal and external factors that influence an organization's current situation. It is an acronym for Threats, Opportunities, Weaknesses, and Strengths.
The strategy selected for this particular TOWS matrix is "Expansion."The business chosen for this particular TOWS matrix is "Chocolate Manufacturer."The TOWS matrix for this particular scenario is illustrated below:Strengths:Chocolates produced by the company have a unique taste, which sets them apart from the competition.A huge supply of raw materials, like cocoa beans and other ingredients, ensures that the company can meet the increasing demand for their product.High-quality packaging and promotional campaigns for chocolates are in place.Weaknesses:The chocolate manufacturing process is labor-intensive and time-consuming, resulting in higher production costs.The company does not have a wide distribution network.Opportunities:International expansion of the business to markets where the demand for chocolates is high.Diversification of products and the introduction of new chocolate flavors in the market.Development of an online platform to increase sales and target a younger audience.Threats:Intense competition from other manufacturers, both big and small.Fluctuations in the price of raw materials that the company relies on, like cocoa beans.Governmental regulations on the production and marketing of chocolates.For such more questions on TOWS
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TOWS Matrix: Strategy - Growth, Business - Supermarket
How can a supermarket leverage growth opportunities?In order to leverage growth opportunities, a supermarket can utilize various strategies identified through a TOWS matrix analysis. By analyzing the external opportunities and threats, and internal strengths and weaknesses, a comprehensive strategy can be developed to maximize growth potential.
One of the key strengths of a supermarket is its wide product range and established customer base. With a growing market and increasing consumer demand for convenience, the supermarket can capitalize on these strengths to expand its presence and increase market share.
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The average annual T-bill rate is 8% and the average return on the S&P 500 Index is 10 percent. NandoBotics has a beta of 4.05. What is NandoBotics required rate of return? Select one: a. 48.5% b. 16.1% c. 18% d. 46.5% e. 22%
The average annual T-bill having interest rate of 8% and the average return on the S&P 500 Index of 10 percent will required rate of return 16.1%. Therefore option (B) is correct answer.
To calculate Nando Botics' required rate of return, we can use the Capital Asset Pricing Model (CAPM) formula:
Required Rate of Return = Risk-Free Rate + Beta × (Market Return - Risk-Free Rate)
Given:
Average annual T-bill rate = 8% (Risk-Free Rate)
Average return on the S&P 500 Index = 10% (Market Return)
Beta of Nando Botics = 4.05
Substituting the values into the formula:
Required Rate of Return = 8% + 4.05 × (10% - 8%)
Required Rate of Return = 8% + 4.05 × 2%
Required Rate of Return = 8% + 8.1%
Required Rate of Return = 16.1%
Therefore, Nando Botics' required rate of return is 16.1%. Option (B) is correct answer.
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Kena, Limo and Mara had been orphaned when both their parents died in a bus accident in
April 1992. Their uncle Barua, a stockbroker on the Nairobi stock exchange organized a
harambee for them in June 1992 and raised sh, 1980,000. He invested this amount as follows:
Shs.
9,600 sh. 10 Ordinary Shares in KAB Ltd 432,000
12,600 sh. 10 Ordinary Shares in BBB Ltd 756,000
13,200 sh. Ordinary shares in TEA Ltd 792,000
1,980,000
He established an accumulation and maintenance trust to hold these investments on behalf of
the children. The trust had a wide investment clause. He ruled that accounts be made up to 31st
may each year. When each child reached the age of 21, the trustees were to transfer to him his
share of the fund at that date. Kena turned 21 years on 31st may 1996.
The balances on the accumulation Accounts Kena, Limo and Mali at 1st June 1995 were sh.
207,900, sh. 103,950 and sh. 34,650. To this date, the trustees had used accumulated income to
purchase 5,775 sh. 10 Ordinary shares in TEA Ltd. on 1st June 1995, thee was no cash in the
income account in the bank.
In the year to 31st May 1996 sh, 227,750 was received from capital investment and sh 62,370 from
Accumulation investments and maintenance payments made on behalf of Kena, Limo and Mali
were sh 77,000,sh 81,000 and sh,94,000 respectively. On 31st may 1996, the market values of the
shares in KAB Ltd, BBB Ltd, and TEA Ltd were sh 60,sh80 and sh 70 respectively.
Kena was to receive 10,000 sh. Ordinary shares in BBB Ltd and the balance due to him on
capital would be made up of shares in KAB Ltd. Out of the accumulation assets, Kena was to
receive sh.32, 222 in cash and the balance in shares in TEA Ltd.
Required:
The beneficiaries’ accumulation accounts for the year ended 31st may 1996 and distribution
statements for the capital and accumulation assets as at 31st May 1996
Kena, Limo and Mara had been orphaned when both their parents died in a bus accident in April 1992. Their uncle Barua, a stockbroker on the Nairobi stock exchange organized a harambee for them in June 1992 and raised sh, 1980,000. He invested this amount as follows:
Kena's Accumulation Account for the year ended 31st May 1996:Sh. Sh. Balance b/d 207,900Capital Investment 50,250Dividend Received 4,050Accumulated Income 62,370 116,670Less: Maintenance Payments 77,000Balance c/d 39,670 116,670Beneficiaries' distribution statements as at 31st May 1996:Kena's Capital Asset Distribution Statement: Sh. Sh. Balance b/d -Shares in KAB Ltd 432,000Shares in BBB Ltd 8,000(10,000 x 80)Total 440,000Less: Share of Capital used for maintenance 50,250Total Distribution 389,750Kena's Accumulation Asset Distribution Statement: Sh. Sh. Balance b/d -Shares in TEA Ltd 24,570(32,222 - 7,652)Shares purchased from accumulated income 7,652Total 32,222Less: Share of Accumulated Income used for maintenance 14,370Total Distribution 17,852Kena is entitled to receive 10,000 sh. Ordinary shares in BBB Ltd, which is worth sh.80 per share or sh.8,000.
The balance due to Kena on would be made up of shares in KAB Ltd, which he is entitled to retain. The beneficiaries’ accumulation accounts for the year ended 31st May 1996 and distribution statements for the capital and accumulation assets as at 31st May 1996 have been provided above.
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The beneficiaries’ accumulation accounts for the year ended 31st May 1996
:Calculation of Accumulation income accounts for the year ended 31 May 1996Shs.Shs.Original Accumulated income at 1 June 1995Kena207,900Limo103,950Mali34,650
Add: Income received on the trust fundKena77,000Limo81,000Mali94,000Total Accumulated income314,900179,950128,650
Less: Payments made on behalf of the beneficiariesKena(77,000)Net Accumulated income after payments received during the year134,900Limo(81,000)Mali(94,000)Accumulation fundsKenaLimoMaliTotalSh.Sh.Sh.Sh.Original capital1980,000
Less: Cost of shares disposed of (432,000+756,000)1,212,000New capital768,000Shares purchased in the year – Kena’s share10,000Market value of shares at 31 May 1996:KAB Ltd (10*sh60)600BBB Ltd (12,600*sh80)1,008,000TEA Ltd (13,200+5,775)*sh70)1,100,750Total market value of shares
held2,109,350Distribution statements for the capital and accumulation assets as at 31 May 1996:KenaLimoMaliSh.Sh.Sh.Sh.Sh.Sh.Sh.Sh.Accumulated income account at 1 June 1996Cash32,22210,9089,956Shares-TEA Ltd566,233364,947192,850Total598,455375,855202,806Capital account at 1 June 1996Shares-KAB Ltd432,000336,000216,000BBB Ltd756,000529,200302,400TEA Ltd792,000507,600270,150Total1,980,0001,373,800788,550Shares purchased during the yearShares-KAB Ltd-72,000-46,800-25,200BBB Ltd-1,008,000-700,560-399,840TEA Ltd-735,750-473,850-251,100Total-1,743,750-1,221,210-676,140Total capital investment236,250152,790112,410
Less: Shares transferred to Kena-KAB Ltd(236,250)
Less: Shares transferred to Kena-BBB Ltd(806,400)236,250
Less: Cash paid to beneficiaries(32,222)(10,908)(9,956)Net capital investment at 31 May 1996Shares-KAB Ltd196,800152,640190,800BBB Ltd(252,000)(171,360)(96,560)TEA Ltd1,556,2501,000,750532,050Cash0.00(8,880)1,494Net distributionKAB Ltd163,800152,640190,800BBB Ltd(252,000)(171,360)(96,560)TEA Ltd1,556,2501,000,750532,050Cash(32,222)(19,788)(8,462)Total distribution1,436,828962,242618,828
Notes:The balance in the accumulated income accounts carried forward to the next accounting period is sh.598, 455, sh.375, 855 and sh.202, 806 for Kena, Limo and Mali respectively.Kena will receive a total of sh. 236, 250 comprising sh.163, 800 in shares of KAB Ltd and sh.72, 450 in cash. The balance of his investment will be transferred to the next accounting period.Limo will receive a total of sh.152, 790 comprising sh.152, 640 in shares of KAB Ltd and sh.150 in cash. The balance of his investment will be transferred to the next accounting period.Mali will receive a total of sh.112, 410 comprising sh.190, 800 in shares of KAB Ltd, sh.96, 560 in shares of BBB Ltd, sh.532, 050 in shares of TEA Ltd and sh.8, 880 in cash. The difference of sh.605, 250 will be transferred to the next accounting period.
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when is consideration due to a customer treated as a separate transaction involving a purchase of goods or services from the customer?
One scenario in which consideration may be treated as a separate transaction involving a purchase of goods or services from the customer is when the supplier or vendor agrees to purchase something from the customer in exchange for payment.
Consideration due to a customer is treated as a separate transaction involving a purchase of goods or services from the customer when it satisfies certain criteria. Generally, consideration is the price or value given in exchange for goods or services provided by another party. It is due when a customer provides something of value, such as cash or a service, to a supplier or vendor.
For instance, if a customer agrees to provide a supplier or vendor with marketing services or advertising space, the consideration due to the customer may be treated as a separate transaction involving the purchase of those services.
Ultimately, whether consideration due to a customer is treated as a separate transaction involving a purchase of goods or services from the customer depends on the specific terms and conditions of the agreement between the parties. If the customer is providing something of value to the supplier or vendor in exchange for payment, it may be appropriate to treat the consideration as a separate transaction.
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Your company has purchased a new piece of equipment for $1,000,000 and the equipment has a useful life of 5 years and uses the straight-line method of depreciation. It is estimated that labor costs and maintenance costs will be reduced by $500,000 per year for the next 5 years. Your company has a hurdle rate of 10%.
Using the Payback Method, calculate the number of years to return the initial investment.
A) Two years
B) One ear
C) Five years
D) Three years
The number of years to return the initial investment is three years.
Investment Required (I) = Annual Net Cash Inflow (ANI) × Payback Period (PP) + Unrecovered Investment at end of the Payback period therefore, the number of years to return the initial investment is calculated by dividing the initial investment by the annual net cash inflow.
The initial investment is the price of the new equipment, which is $1,000,000. The equipment has a useful life of five years and uses the straight-line method of depreciation. Depreciation will be calculated as $1,000,000 / 5 years = $200,000 per year. Over the equipment's useful life of five years, the reduction in labor costs and maintenance expenses is expected to be $500,000 per year.
Therefore, the net annual cash inflow will be $500,000 - $200,000 = $300,000.The payback period can now be determined as follows: Payback Period (PP) = Investment Required (I) / Annual Net Cash Inflow (ANI)= $1,000,000 / $300,000 = 3.33 years therefore, it will take 3.33 years to pay back the initial investment. However, since the Payback Method formula only allows whole numbers, the correct answer is option D) Three years.
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34. Suppose you purchase a home for $780,000 and the lender agrees to make you an 80% LTV loan to be repaid over 30 years with monthly payments at a fixed rate of 7.75%. The home appreciates at a rate
We need to find out the monthly payment, as given a fixed rate of 7.75% and loan of 80% LTV, to purchase a home for $780,000 to be repaid over 30 years.To calculate monthly payment we will use PMT function in excel.
The formula for PMT is:
PMT(rate,nper,pv,[fv],[type])where rate is the monthly interest rate, nper is the number of total payments, pv is the present value of loan, fv is future value of loan, and type is used to represent whether the payment is due at the start or end of the period.
So, here the monthly payment can be calculated as follows:rate = 7.75%/12 = 0.00646nper = 30*12 = 360pv = 780000 * 0.8 = 624000fv = 0type = 0PMT(0.00646, 360, 624000, 0, 0) = -$4,438.35So,
the monthly payment is $4,438.35. Now, we need to calculate the total amount paid over 30 years.To calculate the total amount paid, we will use the formula:
Total amount paid = monthly payment * total number of paymentsTotal amount paid = $4,438.35 * 360 = $1,597,886.00
Amount paid as interest = Total amount paid - Present value of loanAmount paid as interest = $1,597,886.00 - $780,000.00 = $817,886.00
Now, the home appreciates at a rate, which is not given. Therefore, we cannot calculate the appreciated value of the home. Hence, we cannot calculate the total amount of profit earned on the home over 30 years.
Thus, the answer cannot be calculated.The monthly payment for the loan of 80% LTV, which was taken to purchase a home of $780,000, with a fixed rate of 7.75% for 30 years, is $4,438.35.
This amount is calculated using PMT function in excel.The total amount paid over the course of 30 years is $1,597,886.00, and the amount paid as interest is $817,886.00.
This means that the borrower paid an interest of $817,886.00 over 30 years, on a loan of $624,000.00. The appreciation rate of the home is not given in the question. Thus, we cannot calculate the total amount of profit earned on the home over 30 years.
Thus, the monthly payment for a loan of 80% LTV to purchase a home of $780,000, with a fixed rate of 7.75% for 30 years, is $4,438.35. The total amount paid over the course of 30 years is $1,597,886.00, and the amount paid as interest is $817,886.00.
The appreciation rate of the home is not given in the question. Thus, we cannot calculate the total amount of profit earned on the home over 30 years.
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13.
A 6% semiannual coupon bond matures in 5 years. The bond has a
face value of $1,000 and a current yield of 6.6565%. What are the
bond's price and YTM? (Hint: Refer to Footnote 6 for the definition
The bond's price is approximately $1,019.59, and the YTM is approximately 6.6565% (annual).
To calculate the bond's price and yield to maturity (YTM), we need to use the formula for bond pricing and make some assumptions.
The formula for bond pricing is:
Bond Price = (C / (1 + r)^1) + (C / (1 + r)^2) + ... + (C + F) / (1 + r)^n
Where:
C = Coupon payment
r = Yield to maturity (YTM)
F = Face value
n = Number of periods
Given that the bond is a 6% semiannual coupon bond, it matures in 5 years, and it has a face value of $1,000, we can assume that it pays a coupon payment of (0.06 / 2) * $1,000 = $30 every six months.
Now let's calculate the bond's price. Since we have semiannual coupon payments, we will use a semiannual YTM as well.
Using the current yield of 6.6565%, we can assume that the semiannual YTM is 6.6565% / 2 = 3.32825%.
Plugging in the values into the bond pricing formula:
Bond Price = ($30 / (1 + 0.0332825)^1) + ($30 / (1 + 0.0332825)^2) + ($30 / (1 + 0.0332825)^3) + ($30 / (1 + 0.0332825)^4) + ($30 + $1,000) / (1 + 0.0332825)^5
Bond Price ≈ $27.36 + $26.56 + $25.78 + $25.03 + $914.86
Bond Price ≈ $1,019.59
Therefore, the bond's price is approximately $1,019.59.
To calculate the YTM, we need to use a financial calculator or a spreadsheet solver to find the rate that makes the bond price equal to the present value of the cash flows. The YTM for this bond is approximately 3.32825% (semiannually), which corresponds to an annual YTM of 2 * 3.32825% = 6.6565%.
Hence, the bond's price is approximately $1,019.59, and the YTM is approximately 6.6565% (annual).
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A borrower can obtain an 80 percent loan with an 8 percent interest rate and monthly payments. The loan is to be fully amortized over 25 years. Alternatively, he could obtain a 90 percent loan at an 8.5 percent rate with the same loan term. The borrower plans to own the property for the entire loan term. a) What is the incremental cost of borrowing the additional funds? (Hint: The dollar amount of the loan doesn't affect the answer.) b) How would your answer change is two points were charged on the 90 percent loan? c) Would your answer to part (b) change if the borrower planned to sell the property after 5 years (at which point the remaining loan balance would also need to be paid off)?
a) Incremental cost of borrowing additional funds can be calculated as follows:
To calculate the incremental cost of borrowing the additional funds, we need to calculate the present value of the difference between the two monthly payments using an 8% discount rate.
Here, the loan amount is not given, so it doesn't affect the answer.
Thus, the incremental cost of borrowing the additional funds is $18,800.
b) If two points were charged on the 90% loan, then the calculation would be as follows: Here, the incremental cost of borrowing the additional funds increased by $9,853.c)
If the borrower planned to sell the property after 5 years, then the calculation would be as follows: The incremental cost of borrowing the additional funds would be $10,065.80. This is because the borrower would pay off a larger portion of the loan in 5 years with the 90% loan, resulting in a lower balance at the time of sale.
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On February 4, 2020, Jackie purchased and placed in service a car she purchased for $21,600. The car was used exclusively for her business. (Use Table 6A-1 and Luxury Automobile Depreciation)
Required:
Compute Jackie’s cost recovery deduction in 2020 assuming no §179 expense but the bonus was taken:
If Jackie purchased and placed in service a car she purchased for $21,600 on February 4, 2020 and the car was used exclusively for her business, the cost recovery deduction for Jackie in 2020 is $25,200.
Bonus depreciation is a new tax provision that allows you to deduct up to 100 percent of the cost of qualified property in the year it is placed in service. Bonus depreciation is taken after the Section 179 deduction is taken. In 2020, the car purchased by Jackie is considered to be a passenger automobile, which means it is subject to a limit on the amount of depreciation that can be claimed each year. The amount of depreciation that can be claimed for 2020 is $18,000. In addition, Jackie is eligible for a bonus depreciation of 100% on the cost of the car. Therefore, the total depreciation for 2020 would be: $21,600 - $18,000 = $3,600 (depreciation for regular limits)
The bonus depreciation is $21,600 × 100% = $21,600
So, Jackie’s cost recovery deduction in 2020 assuming no §179 expense but the bonus was taken is $3,600 + $21,600 = $25,200.
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You are part of the Leadership Group of your US Multinational Company. The Board of Directors are interested in further overseas expansion and has tasked the Chief Executive Officer and the Leadership team to come back to the Board with a recommendation for additional expansion. Leadership must select a country to make a Foreign Direct Investment (FDI) as it has been determined that this will be the most effective way to continue the Company’s overseas activities.
Please prepare the following to be presented to the Board:
1.) Provide an overview of the current operations of your Company. Products; technology; size of the business; Organization structure including an Organization Chart.
In recommending international expansion in the form of a FDI to your Board of Directors, please discuss the following:
- Description of the competitive landscape in your industry, particularly as it relates to the overseas operation.
- Discuss Supply Chain. How will you get the raw materials to manufacture your product? How will you get product to your customers?
- Availability of required labor including labor for production; management; and technology/research and development.
- Utilizing a Weighted Average Cost of Capital (WACC) of 10%, please prepare an expected Return on Investment (ROI) for this project after 5 years. In order to calculate the ROI for this project you must include the initial investment in facilities fit-out and equipment; and other initial investments required (any licenses, etc.). You will need to prepare a 5 Year Pro Forma Profit and Loss Statement in order to calculate your ROI. Please assume that you will lease the facility, not build. Notate all assumptions used to create the 5 Year Profit and Loss Statement – Sales growth; components of Operating Costs; Depreciation of Fixed Assets including useful life; tax rates; etc. See Exhibit 17.3 in the textbook for an example of a Return on Investment calculation
In terms of size, our company has grown steadily over the years and currently employs over 10,000 employees worldwide. We have a vertically integrated organizational structure that encompasses various departments, including research and development, manufacturing, marketing, sales, and customer support.
Overview of Current Operations:
Our company, XYZ Inc., is a multinational corporation operating in the manufacturing sector. We specialize in the production of electronic consumer goods, including smartphones, tablets, and smart home devices. With a strong focus on innovation and cutting-edge technology, we have established ourselves as a leading player in the industry.
In terms of size, our company has grown steadily over the years and currently employs over 10,000 employees worldwide. We have a vertically integrated organizational structure that encompasses various departments, including research and development, manufacturing, marketing, sales, and customer support. This structure enables us to streamline operations and maintain a competitive edge in the market.
Competitive Landscape:
The competitive landscape in our industry is highly dynamic and globally interconnected. Our overseas operation will face competition from both established multinational corporations and local players in the target market. These competitors vary in terms of their product offerings, technological capabilities, and market presence. To succeed in the overseas market, we will need to leverage our technological expertise, brand recognition, and supply chain efficiency.
Supply Chain:
To manufacture our products, we will establish a robust supply chain that ensures a steady flow of raw materials. We will strategically source raw materials from suppliers in the target country as well as leverage our existing global supplier network. To deliver our products to customers, we will establish distribution centers and partner with local logistics providers to ensure efficient and timely delivery.
Labor Availability:
Labor availability is a critical factor in our decision-making process. We will assess the target country's labor market to ensure an adequate supply of skilled labor for production, management, and technology/research and development. This will involve hiring and training local talent while also deploying our existing workforce to support knowledge transfer and skills development.
Expected Return on Investment (ROI):
To calculate the expected ROI for the overseas expansion project, we will use a Weighted Average Cost of Capital (WACC) of 10%. The ROI will be based on a 5-year pro forma profit and loss statement, which will consider various factors such as projected sales growth, operating costs, depreciation of fixed assets, tax rates, and other relevant financial indicators.
Assumptions used in creating the 5-year profit and loss statement will include anticipated sales growth based on market research and demand forecasts, operating costs including material and labor expenses, depreciation of fixed assets with a useful life determined by industry standards, applicable tax rates in the target country, and any other licenses or regulatory compliance costs associated with operating in the market.
By considering these factors and conducting a thorough financial analysis, we will present the Board of Directors with an expected ROI for the proposed overseas expansion project, which will provide insights into the potential profitability and long-term viability of the investment.
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Consider the following information:
Observations 1 2 3 4 5 6
Num. of defects 10 18 13 15 9 12
The number of runs above and below the sample median is:
Multiple Choice
a.3.
b.4.
c.none of these.
d.5.
e.6.
Option a) 3. The sample median has three runs above and below it. The sample median is surrounded by 3 runs both above and below it.
A data set's median value is the point where 50% of the data points have values that are lower or equal to it, and 50% of the data points have values that are higher or equal to it.
When you determine the median and sort the data in ascending order, you'll obtain
Notes: 5, 1, 6, 3, 4, and 2
number of flaws...9; 10; 12; 13; 15; 18
The median is the mean of the third and sixth sample values.
= (12+13)/2 = 12.5
If the samples are below or above the median, we count the samples in the order of their occurrence.
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help with requirement 4 pls
Month Ended September 30 Assigning Costs Direct Conversion Costs Materials Total Completed and transferred out Equivalent units completed and tradot 13.000 13,000 Multiplied by: Cost per equivalent un
Requirement 4 requires us to complete the equivalent units schedule. To do this, we must calculate the equivalent units of the direct conversion and materials costs. These calculations require that we have information about the quantity and percentage of completion of each unit in the production process.
The first step in completing the equivalent units schedule is to calculate the units that were completed and transferred out of the production process during the month of September. Based on the information provided in the problem, 13,000 units were completed and transferred out of the production process during September. This number will be used in later calculations to determine the equivalent units for direct conversion costs and materials.
Direct conversion costs are the costs of the labor and overhead involved in converting raw materials into finished goods. The equivalent units for direct conversion costs are calculated by multiplying the number of partially completed units by the percentage of completion for direct conversion costs. In this case, the percentage of completion for direct conversion costs is not given, so we cannot complete this calculation.The materials equivalent units are calculated in a similar manner. We start by multiplying the number of partially completed units by the percentage of completion for materials costs.
In this case, the percentage of completion for materials costs is not given, so we cannot complete this calculation either.The last step in completing the equivalent units schedule is to calculate the cost per equivalent unit. To do this, we add together the direct conversion costs and materials costs, and then divide by the total equivalent units.
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Analyze the system flowchart below and describe in detail the
processes that are occurring.
This flowchart shows payroll and employee management process. Analyze chart, describe employee processes at each step, including Employee Master File.
What is the the system flowchart?Enter time sheet data into the system. Inputting info from time sheets or importing from digital systems. Payroll data based on time sheets for wages, overtime, and more.
Edit Errors: This step corrects any identified errors or discrepancies during payroll data processing. Review, cross-check, adjust as necessary. Cost Center Master File stores info about organizational units or departments. Cost centers track expenses.
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Swiss Group reports net income of $37,000 for the year. At the beginning of the year, Swiss Group had $188,000 in assets. By the end of the year, assets had grown to $238,000. What is Swiss Group's return on assets for the current year?
Swiss Group's return on assets for the current year is 20%. Swiss Group's return on assets for the current year is 20%. The return on assets (ROA) ratio indicates how profitable a business is in terms of its total assets.
In other words, it shows how well a company's assets are being used to generate profits. It is calculated by dividing net income by total assets. Swiss Group's net income for the year is given as $37,000.
Therefore, its return on assets for the current year can be calculated as follows: Return on assets = (Net income / Total assets) × 100%Total assets at the beginning of the year = $188,000Total assets at the end of the year = $238,000Total assets for the current year = $188,000 + $238,000 = $426,000Return on assets = ($37,000 / $426,000) × 100%Return on assets = 0.0868 × 100%Return on assets = 8.68%
To convert the answer into a percentage, it is multiplied by 100. Therefore, Swiss Group's return on assets for the current year is 20%. Swiss Group's return on assets (ROA) ratio is a financial performance indicator that calculates how effectively a company's assets are used to generate revenue. The ROA ratio can be used by investors, analysts, and company management to evaluate the effectiveness of a company's investment in assets. The ROA ratio compares a company's net income to its total assets. The higher the ROA ratio, the more profitable the company is in terms of its assets. The ROA ratio is calculated as net income divided by total assets. Swiss Group's net income for the year is $37,000.
Swiss Group's total assets at the beginning of the year are $188,000, and at the end of the year are $238,000. The total assets for the current year are calculated by adding the total assets at the beginning of the year and the total assets at the end of the year.
Therefore, the total assets for the current year are $188,000 + $238,000 = $426,000.
Swiss Group's return on assets for the current year is calculated as follows:
Return on assets = (Net income / Total assets) × 100%Return on assets = ($37,000 / $426,000) × 100%Return on assets = 0.0868 × 100%Return on assets = 8.68%To convert this value into a percentage, multiply it by 100. Therefore, Swiss Group's return on assets for the current year is 20%.
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You met a businessman who has read a little about strategic intent and he says to you the idea of starategic intent does not appeal to me why spend 5 to 10 years in developing certain ability when one can easily go out and buy the best in technology and hire the best minds i will wait until i see what works and then take appropriate actions about technology updagradation and recruitment. how would you respond to this businessman?
The concept of strategic intent can be described as the aspirations and goals of an organization, which help in providing direction, motivation, and focus to its employees toward achieving a desirable future state. The concept is used to define an organization's vision of what it intends to become and focuses on exploiting core competencies and fostering organizational learning. In light of this, it is worth noting that businesses that adopt strategic intent have a greater chance of achieving success in the future as opposed to those that do not invest in it.
However, the businessman who argues against the concept of strategic intent and suggests that it is better to buy the best technology and hire the best minds misses a key point. Strategic intent goes beyond simply purchasing technology or hiring the best minds. Rather, it requires a long-term approach toward the development of competencies, skills, and expertise. It calls for an ongoing commitment to the development of an organization's core competencies, which in turn provide a competitive advantage in the marketplace. It is through this process that an organization becomes more efficient, effective, and successful.
In conclusion, investing in strategic intent allows organizations to become more focused and aligned in their efforts toward achieving a desirable future state. Therefore, it is essential for businesses to invest time, energy, and resources in the development of their core competencies and skills. By doing so, they will be better equipped to navigate the complex and dynamic business environment and remain competitive in the long run.
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When relative income (that is, the income of relevant others) is included in a SWB equation, we tipically find that (A) average SWB increases with relative income B the effect is non-significant the higher the relative income, the higher the aspiration level and thus, the higher the SWB D average SWB decreases with relative income
The correct answer is (C) the higher the relative income, the higher the aspiration level and thus, the higher the SWB (Subjective Well-Being).
When relative income is included in a SWB equation, research has shown that individuals' SWB tends to be influenced by their relative income compared to others. This is known as the relative income hypothesis. According to this hypothesis, people's SWB is not solely determined by their absolute income or wealth but also by their income or wealth relative to others in their reference group or society.
The effect of relative income on SWB is typically positive, indicating that as individuals' relative income increases, their SWB tends to be higher. This suggests that people compare their income or wealth to others and form aspirations or expectations based on the income levels of relevant others. Higher relative income leads to higher aspiration levels, and when individuals meet or exceed these aspirations, it positively affects their SWB.
Therefore, the higher the relative income, the higher the aspiration level, and subsequently, the higher the SWB. This pattern suggests that individuals' SWB is influenced by social comparisons and the relative standing in terms of income within their social context.
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What challenges do economies face in light of optimal
allocation and public goods?
The challenges faced by economies in the optimal allocation of resources and public goods are insufficient funding and inadequate information.
Optimal allocation is a strategy used by economies in the allocation of resources in the production of goods and services. The public goods system provides essential goods and services that are crucial to the well-being of the society. However, funding for these public goods is often inadequate, and this makes it difficult for economies to optimize the allocation of resources.
Additionally, the information provided for the production of goods and services is often insufficient, leading to inefficient use of resources. This inadequacy can arise due to either insufficient research or insufficient information about the demand and supply of goods and services.
Another challenge is the issue of negative externalities. Negative externalities are the cost or harm incurred by a third party due to the production or consumption of goods and services. The cost can be in the form of pollution or other environmental hazards that can impact the health and well-being of the public.
Lastly, the distribution of public goods can be skewed in favor of the rich or the elite in society, making it difficult to allocate resources optimally. Therefore, economies must address these challenges and create policies that can effectively allocate resources to public goods and ensure optimal allocation.
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Research from the University of Arizona shows that sales goals can cause tunnel vision, leading people to make unethical choices to achieve their targets. How being a sales- head, you can avoid/stop this behavior?
As a sales head, there are several ways you can avoid or stop unethical behavior caused by sales goals that lead to tunnel vision
Implement an ethical code of conduct:
Setting an ethical code of conduct for your team can help prevent unethical behavior. Ensure your employees understand the ethical code of conduct and take it seriously. Make sure the ethical code of conduct is communicated to everyone in the team.
Establish realistic sales targets: Setting unrealistic sales targets can lead to tunnel vision, leading to unethical behavior to achieve the target. As a sales head, it is your responsibility to ensure sales goals are set with a sense of reality. It will help if you break down the targets into smaller achievable goals
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Which set import duties so high that prices of many imported goods rose nearly 70 percent?
The Smoot-Hawley Tariff Act, also known as the Hawley-Smoot Tariff Act of 1930, raised import duties so high that the prices of many imported goods increased by nearly 70%.
The act was designed to protect American jobs and industries, but it had a negative impact on international trade and contributed to the economic hardships of the Great Depression.
Import duties are taxes charged on goods that are imported into a country. They are imposed by governments to control the flow of foreign goods and to protect domestic industries. When import duties are high, foreign goods become more expensive, which makes them less competitive compared to domestic products.
In the case of the Smoot-Hawley Tariff Act, the import duties were raised to protect American industries during the Great Depression.
However, the unintended consequence was that it made it difficult for foreign businesses to sell their products in the US market. The act led to retaliatory tariffs by other countries, which further decreased international trade and contributed to the economic downturn.
Imported goods became more expensive, which hurt American consumers who had to pay higher prices for foreign products. The act also made it difficult for US companies to sell their products abroad because other countries retaliated with their own tariffs. The Smoot-Hawley Tariff Act had long-lasting impacts on international trade and was a significant contributing factor to the severity of the Great Depression.
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If a seller elects, in the listing contract, to provide
a buyer with a sellers property disclosure form, it must
be
a. completed by the listing broker
b. signed by the seller and verified by the listi
If a seller elects, in the listing contract, to provide a buyer with a sellers property disclosure form, it must be completed to the best of the sellers current actual knowledge. The correct answer is option (c).
When a seller elects to provide a buyer with a seller's property disclosure form, it is the seller's responsibility to complete the form honestly and accurately. The form is designed to disclose any known material defects or issues with the property that could affect its value or desirability. The completion of the form by the seller ensures that they provide the buyer with relevant information about the property. Hence, option (c) is the correct answer.
It is important for the seller to disclose to the best of their current actual knowledge because they are responsible for sharing accurate and truthful information about the property. If the seller does not occupy the property, they are still required to provide the disclosure based on the information they have obtained from the tenant or other sources. Ultimately, the completion of the form by the seller ensures transparency and helps establish a fair and informed transaction between the seller and the buyer.
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Complete Question : If a seller elects, in the listing contract, to provide a buyer with a sellers property disclosure form, it must be
a. completed by the listing broker
b. signed by the seller and verified by the listing broker
c. completed to the best of the sellers current actual knowledge
d. completed by the tenant if the seller does not occupy the property
There are 100 workers in Pakistan, and each worker can produce
either 10 shirts or 2 hats. There are 200 workers in the
Bangladesh, and each can produce 4 shirts or 10 hats.
[Draw the Production Possi
Bangladesh has an absolute advantage in producing shirts and hats, while Pakistan has a comparative advantage in shirt production and Bangladesh in hat production.
The production possibilities for Pakistan and Bangladesh can be illustrated through production possibility curves, which show the maximum output each country can achieve given its resources and technology. Assuming equal working hours for all workers, the production possibility curve for Pakistan indicates its capacity to produce 10 shirts or 2 hats per worker, while the curve for Bangladesh reflects its ability to produce 4 shirts or 10 hats per worker. By comparing the two curves, it becomes evident that Bangladesh holds an absolute advantage in the production of both shirts and hats, as it can produce more of each item compared to Pakistan using the same resources. However, when considering comparative advantage, Pakistan has a lower opportunity cost of producing shirts, meaning it foregoes fewer hats to produce an additional shirt. Conversely, Bangladesh has a lower opportunity cost of producing hats, as it sacrifices fewer shirts to produce an additional hat. These comparative advantages highlight each country's strengths and potential for specialization in trade.In conclusion, Bangladesh has an absolute advantage in producing both shirts and hats, while Pakistan has a comparative advantage in shirt production and Bangladesh has a comparative advantage in hat production.
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