The entries on the credit side of the cash account at the end of August 2019 are Bank £7,000, Sales £54 (option c), and the closing balance brought down on the purchases account at the end of August 2019 is £362 credit (option d).
Based on the information provided, the entries on the credit side of the cash account at the end of August 2019 would be option c: Bank £7,000, Sales £54.
To arrive at this answer, we need to analyze the given options. From the given options, only option c includes a credit to the cash account (Bank £7,000), which indicates the receipt of money into the account. The other options, a, b, and d, do not include a credit entry to the cash account.
Therefore, the correct answer is c: Bank £7,000, Sales £54.
Regarding the closing balance brought down on the purchases account at the end of August 2019, the correct answer is d: £362 credit.
To determine the closing balance, we need to consider the debit and credit entries on the purchases account. None of the options provide a debit entry on the purchases account, except option d, which states a credit of £362. This indicates that there were no increases in the purchases account and a decrease of £362.
Therefore, the correct answer is d: £362 credit.
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3. The following regression is the demand for fair-trade coffee which was estimated from nationwide weekly data provided by a UK retailer over a twoyear period: Q
x
=69,918.13−43,204.4P
x
−2,266.83P
y
+0.13V where: Q
x
= quantity of fair-trade coffee sold (number of packs); P
x
= average price of fair-trade coffee per pack (£); P
y
= average price of non-fair-trade coffee per pack (£); and V= number of customers purchasing any type of grocery in this UK retailer. Parenthesis refer to the t-statistics (the critical value for significance is ±1.96 ). The average of each variable is as follows:
Q
ˉ
x
=54576.7;
P
ˉ
x
=£3.06;
P
ˉ
y
=£ 2.74;
V
ˉ
=891394.9 (i) What is the functional form of this equation? What are the main advantages and limitations of this functional form?
ii. Calculate the values of the two elasticities & critically interpret their meaning.
iii.If Marginal Cost MC=1 (constant) and marginal revenue follows the function derived from the initial demand curve
MRx=4.12 - 0.0000463*Qx
Calculate the profit-maximizing price & the revenue maximizing price and determine whether the current price is closer to the profit-maximizing or revenue-maximizing price and how it relates to elasticities.
Indirect demand function is Px=1.88 - 0.0000231*Qx
The functional form of this equation is linear, which offers simplicity and ease of interpretation but may oversimplify complex relationships.
The price elasticities reflect how demand responds to price changes. With a marginal cost of 1, we can determine the profit-maximizing and revenue-maximizing prices and examine their relationships with elasticity.
The functional form of this equation is linear, which is advantageous due to its simplicity and interpretability. However, a linear form may oversimplify complex relationships and may not fully capture the real-world complexity of demand (Gujarati & Porter, 2009). The price elasticity of demand for fair-trade coffee, given by the coefficient of Px, is -43,204.4, implying that demand is inelastic, i.e., changes in price lead to less than proportionate changes in quantity demanded. The cross-price elasticity with respect to non-fair-trade coffee is -2,266.83, indicating they might be complements. With constant MC=1, the profit-maximizing price is achieved where MR=MC, while the revenue-maximizing price is obtained where the elasticity of demand is -1. The current price can be compared to these to understand the firm's pricing strategy (Pindyck & Rubinfeld, 2018).
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1. What is the equilibrium quantity and price? 2. Suppose that the town council wants to reduce cigarette consumption. It imposes a quantity tax per unit of cigarettes
"
1. Equilibrium price and quantity are the ones at which the supply and demand curves intersect. It's where the amount demanded equals the amount supplied. At this stage, the market has reached its optimal price and quantity.
Equilibrium price and quantity are critical to the economics of a commodity because they decide the amount of production, supply, and demand. The two curves meet at the point of intersection to create equilibrium.2. If a quantity tax is imposed per unit of cigarettes to reduce cigarette consumption, the supply curve shifts upwards, as the production cost for the company increases. Hence, this implies that the equilibrium price and quantity will both increase. As the supply decreases, the price rises.
However, the price increase could decrease the demand for cigarettes. Therefore, the impact of the quantity tax on the equilibrium price and quantity cannot be anticipated. Imposing a quantity tax per unit of cigarettes reduces the number of cigarettes in the market. As a result, there is a decrease in the supply of cigarettes, leading to an increase in the price of cigarettes. The price of cigarettes is increased due to the added tax imposed. Due to the high cost, the number of consumers willing to buy cigarettes decreases. If the price of a product is high, its demand decreases, leading to a decrease in its production.
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The withdrawal of private investment in the Global South has made the Global South's need for support during the COVID-19 global pandemic even direr. True False
True. Explanation:Private investment withdrawal is a significant barrier for the Global South, and it creates a dire need for support during the COVID-19 global pandemic.
The spread of the COVID-19 virus has forced governments in the Global South to take steps such as shutting down whole industries, closing borders, and implementing strict social distancing measures to curb the spread of the virus.
These measures have had a significant effect on the economy, with businesses struggling to maintain their operations, and many of them are shutting down due to lack of capital.The removal of private investment from the Global South has caused significant harm, especially in the middle of the pandemic. As a result, there is a growing need for increased support to help the Global South overcome these challenges during the COVID-19 pandemic. Hence, it's true that the withdrawal of private investment in the Global South has made the Global South's need for support during the COVID-19 global pandemic even direr.
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ASE SCENARIO
The news headlines shouted, "Project halted due to strike by Jamaican workers."
The project was a very expensive multimillion US dollar construction of a sporting facility, in Montego Bay, Jamaica. The facility would span over 350 acres of land and is funded by loans at a concessionary rate by a state-sponsored Chinese company at approximately $56 billion US dollars. Work commenced on November 19, 2021, and is expected to end on January 15, 2023. As a part of the deal, Chinese workers would be imported to work on one segment of the project while Jamaican workers would work on the other segment.
It seems there was a lack of understanding and coordination among the teams. Complaints were that some Chinese employees had better protective gear than Jamaicans, but some of the comments that raised eyebrows were comments attributed to some Jamaican workers that the Chinese workers were overly industrious and efficient and as a result, the tasks were being completed much too quickly. A faster completion rate it seems would lessen the period of employment and fears were the Chinese would be assigned to the areas being completed by the Jamaicans.
Both the Chinese and Jamaican governments were adamant that the project be completed in time for a major upcoming international sporting event and without massive cost overruns, that were not unusual for projects of that magnitude.
Identify and explain the role of THREE (3) primary stakeholders of the project.
(6 marks) CLO 1
Explain how you would apply any FOUR (4)different phases of project management to
this project.
Primary stakeholders of the project:
1. Jamaican government: The Jamaican government is a primary stakeholder in this project because the facility is being constructed on Jamaican land. The government is interested in ensuring that the project is completed on time and to budget so that the country can benefit from the economic benefits of hosting international sporting events.
2. Chinese government: The Chinese government is also a primary stakeholder in this project because it is funding it. The Chinese government wants to ensure that the facility is completed on time and to budget so that it can demonstrate its capacity for large-scale infrastructure projects.
3. Workers: The workers are primary stakeholders because their livelihoods are dependent on the project's success. The Chinese and Jamaican workers have different concerns, but both want the project to be completed to a high standard and to provide them with long-term employment.
Four different phases of project management:
1. Initiation: This phase is all about defining the project and setting its objectives. In the case of this project, the initiation phase would involve establishing the scope of the project and setting out a timeline for its completion.
2. Planning: The planning phase involves developing a detailed plan of how the project will be executed. In the case of this project, the planning phase would involve developing a detailed work breakdown structure and identifying the resources needed to complete each task.
3. Execution: The execution phase is where the project plan is put into action. In the case of this project, the execution phase would involve managing the Chinese and Jamaican workers and ensuring that the project is on track to meet its objectives.
4. Monitoring and controlling: The monitoring and controlling phase involves tracking the progress of the project and making adjustments as necessary. In the case of this project, the monitoring and controlling phase would involve keeping a close eye on the progress of the Chinese and Jamaican workers and making sure that the project is on track to meet its objectives.
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An investor's optimal investment policy is affected by the relationship between income and expenses, In general Select one: a. the larger the ability to increase savings, the more aggressive the investment policy can be because of the ability to save more if needed b. the smaller the ability to increase savings, the more aggressive the investment policy should be to conserve existing wealth c. the smaller the ability to increase savings, the more aggressive the investment policy should be to increase wealth d. the larger the ability to increase savings, the more conservative the investment policy should be to conserve existing wealth
An investor's optimal investment policy is influenced by the relationship between income and expenses. Generally speaking, the larger an investor's ability to increase savings, the more aggressive their investment policy can be. This is because having a greater ability to save allows them to take on more risk and potentially earn higher returns.
Let's break down each option to see which one aligns with this idea:
The larger the ability to increase savings, the more aggressive the investment policy can be because of the ability to save more if needed.This option supports the concept mentioned earlier. If an investor has a larger ability to increase savings, they have more flexibility in taking on riskier investments because they have a safety net in their increased savings. If needed, they can save more to compensate for any potential losses.
The smaller the ability to increase savings, the more aggressive the investment policy should be to conserve existing wealth.This option seems counterintuitive. If an investor has a smaller ability to increase savings, it implies that they have limited funds available for investing. In such a scenario, it would be more prudent for them to adopt a more conservative investment policy to protect their existing wealth rather than taking on additional risks.
The smaller the ability to increase savings, the more aggressive the investment policy should be to increase wealth. Similar to the previous option, this statement does not align with the general principle. If an investor has limited ability to increase savings, it would be wiser for them to be more cautious with their investments to safeguard their wealth, rather than adopting a more aggressive approach. The larger the ability to increase savings, the more conservative the investment policy should be to conserve existing wealth.
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The settle or closing price for the November 2022 Feeder Cattle futures contract on 8/19 was: 145.275 dollars per hundredweight (\$145.275/cwt)
a) Fill out the following table for a Feeder Cattle Put using the information provided for the November 2022 Feeder Cattle Put. Strike prices and premiums are reported in dollars per hundredweight.
Strike Price Premium Intrinsic Value Time Value In,At, or Out
142.00 1.350
143.00 1.800
144.00 2.100
145.00 2.475
b) How many options contracts would you need to purchase to appropriately cover 200 head of feeder steers with an expected sale weight of 800lb per head?
c) Pick the strike price in the 3rd row of the table. If you purchased Feeder Cattle puts to appropriately cover 200 head with an expected sale weight of 8001 b per head (as determined in part b), what would the total premium cost be? (show the work for your calculation)
a)Strike Price 142.00 with a premium of 1.350, 143.00 with a premium of 1.800, 144.00 with a premium of 2.100, and 145.00 with a premium of 2.475, b) To cover 200 head of feeder steers with an expected sale weight of 800lb per head, 1,600 options contracts would be needed.
c) Using the strike price in the 3rd row (144.00), the total premium cost for covering 200 head of feeder steers with an expected sale weight of 800lb per head would be $3,360.
a) Completed table for the Feeder Cattle Put:
Strike Price | Premium | Intrinsic Value | Time Value | In, At, or Out
------------ | ------- | -------------- | ---------- | -------------
142.00 | 1.350 | 3.275 | 0.975 | In the money
143.00 | 1.800 | 2.275 | 0.525 | In the money
144.00 | 2.100 | 1.275 | 0.825 | In the money
145.00 | 2.475 | 0.275 | 2.200 | Out of the money
We need to calculate the intrinsic value and time value for each strike price based on the given closing price of the November 2022 Feeder Cattle futures contract.
The intrinsic value represents the difference between the strike price and the futures price, while the time value is the remaining premium after subtracting the intrinsic value.
For example, for the strike price of 142.00, the intrinsic value is calculated as (145.275 - 142.00) = 3.275, and the time value is the remaining premium after deducting the intrinsic value, which is (1.350 - 3.275) = 0.975.
b) To appropriately cover 200 head of feeder steers with an expected sale weight of 800lb per head, you would need to purchase options contracts for the equivalent number of hundredweights.
Assuming each head of feeder steer weighs 800lb, the total weight of 200 heads would be (200 * 800) = 160,000lb. Since options contracts are typically based on hundredweights, you would divide the total weight by 100 to determine the number of options contracts needed.
Therefore, you would need (160,000 / 100) = 1,600 options contracts.
c) Picking the strike price in the 3rd row of the table (144.00), and assuming each option contract covers 100 hundredweights, the total premium cost can be calculated by multiplying the premium by the number of contracts.
Therefore, the total premium cost would be (2.100 * 1,600) = $3,360.
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Stone Culture Corporation was organized on January 1, 2020. For its first two years of operations, it reported the following: Required: On the basis of the data given, prepare a statement of retained earnings for both 2020 (its first year of operations) and 2021. Complete this question by entering your answers in the tabs below. On the basis of the data given, prepare a statement of retained earnings for 2020 .
The amount of retained earnings at the end of the year 2020 will become the retained earnings balance at the beginning of the year 2021.
Stone Culture Corporation was organized on January 1, 2020. For its first two years of operations, it reported the following:On the basis of the given data, we can prepare the statement of retained earnings for 2020 as follows:
Retained earnings, January 1, 2020 = 0
Add: Net income for 2020 = 82,000
Less:
Dividends declared in 2020 = 16,000
Retained earnings, December 31, 2020 = 66,000.
The statement of retained earnings for 2020 is as follows:
Stone Culture Corporation Statement of Retained Earnings
For the year ended December 31, 2020
Retained earnings, January 1, 2020 0
Add:
Net income for 2020 82,000
Less: Dividends declared in 2020 (16,000)
Retained earnings, December 31, 2020 ,66,000
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Yale Corporation had the following results last year (in thousands). Management's target rate of return is 10% and the weighted average cost of capital is 5%. Its effective tax rate is 30%.
Sales $30,000,000
Operating income 2,400,000
Total assets 6,000,000
Current liabilities 5,080,000
What is the division's Return on Investment (ROI)?
A. 40%
B. 8%
C. 250%
D. 47.24%
Ruby's Department Store has budgeted cost of goods sold of $42,000 for its men's shorts in March. Management also wants to have $7,000 of men's shorts in inventory at the end of March to prepare for the summer season. Beginning inventory of men's is expected to be $4,900. What dollar amount of men's shorts should be purchased in March?
A. $44,100
B. $53,900
C. $30,100
D. $39,900
Answer: C. [tex]250%[/tex].
Therefore, the division's Return on Investment (ROI) is C. [tex]250%[/tex].
Answer: A. [tex]$44,100[/tex]
Therefore, the dollar amount of men's shorts that should be purchased in March is A. [tex]$44,100.[/tex]
Yale Corporation had the following results last year (in thousands). Management's target rate of return is [tex]10%[/tex] and the weighted average cost of capital is 5%. Its effective tax rate is [tex]30%[/tex]. Sales [tex]$30,000,000[/tex] Operating income [tex]2,400,000[/tex] Total assets [tex]6,000,000[/tex] Current liabilities [tex]5,080,000[/tex].
A formula for calculating ROI is: ROI = Net Income / Total Investment. Yale Corporation's ROI can be calculated as follows: Net Income = Operating Income x (1 - Tax Rate) =[tex]$2,400,000 x (1 - 0.30) = $1,680,000[/tex] Total Investment = Total Assets - Current Liabilities = [tex]$6,000,000 - $5,080,000 = $920,000[/tex]ROI = Net Income / Total Investment = [tex]$1,680,000 / $920,000 = 1.826[/tex]ROI is [tex]182.6%[/tex].
Ruby's Department Store has budgeted cost of goods sold of [tex]$42,000[/tex] for its men's shorts in March. Management also wants to have [tex]$7,000[/tex] of men's shorts in inventory at the end of March to prepare for the summer season.
Beginning inventory of men's is expected to be [tex]$4,900[/tex]. The formula to calculate the cost of goods sold is as follows: Beginning inventory + Purchases - Ending inventory = Cost of goods sold.
Therefore, Purchases = Cost of goods sold - Beginning inventory + Ending inventory. Using the values provided in the question: Purchases = [tex]$42,000 - $4,900 + $7,000 = $44,100[/tex]
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Describe in details the impact of political economy in the society and economic progress either in China or in India
The political economy of China and India has a significant impact on their societies and economic progress, influencing factors such as governance, economic policies, social welfare, and inequality.
In the case of China, the country's political economy has played a crucial role in its rapid economic growth and transformation. The Chinese government implemented a unique blend of state-led capitalism and market-oriented reforms, allowing for a controlled transition from a centrally planned economy to a more market-based system.
The government's ability to maintain political stability, enforce policies, and provide infrastructure support has been instrumental in attracting foreign investment, fostering industrial development, and promoting export-oriented growth.
Similarly, in India, the political economy has shaped the country's economic progress and social development. India's democratic political system, combined with a mixed economy, has influenced its economic policies and priorities. The government has focused on liberalizing the economy, attracting foreign investment, and promoting entrepreneurship and innovation.
However, challenges such as bureaucratic inefficiencies, corruption, and income inequality remain, impacting the pace and inclusivity of economic progress. Efforts to address these issues and promote social welfare through poverty alleviation programs, education reforms, and inclusive growth policies are ongoing.
Overall, the political economy of China and India has had a profound impact on their societies and economic progress. The interplay between political and economic factors, along with specific policy choices and institutional frameworks, has shaped their respective development trajectories.
Understanding and managing the complexities of political economy are crucial for policymakers in order to foster sustainable economic growth, reduce inequalities, and address societal challenges.
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"
What is the difference between a company's mission statement and its strategic vision?
A company's mission statement and its strategic vision serve different purposes. The mission statement outlines the organization's purpose, values, and overall objectives, while the strategic vision focuses on the desired future state and direction of the company.
A company's mission statement is a concise statement that articulates the organization's purpose, core values, and fundamental objectives. It answers the question of why the company exists and what it aims to achieve. The mission statement provides guidance to employees, stakeholders, and customers, communicating the company's overall identity and guiding principles.
On the other hand, a strategic vision is a forward-looking statement that outlines the desired future state of the company. It describes the long-term goals and aspirations of the organization, providing a sense of direction and purpose. The strategic vision is more focused on the future, highlighting where the company wants to be and how it intends to position itself in the marketplace.
While the mission statement focuses on the present and the core purpose of the company, the strategic vision looks ahead and provides a framework for decision-making and strategic planning. Both elements are important in guiding the company's actions, but they serve different functions in defining the company's identity and shaping its strategic direction.
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The higher the debt-equity ratio, the greater the difference between return on assets and return on equity. True False
The statement is false. The higher the debt-equity ratio, the smaller the difference between return on assets and return on equity.
The higher the debt-equity ratio, the smaller the difference between return on assets (ROA) and return on equity (ROE). Return on assets is a measure of the profitability of a company's total assets, while return on equity measures the return generated specifically for the equity shareholders.
When a company has a higher debt-equity ratio, it means that it has a higher proportion of debt compared to equity in its capital structure. This results in higher interest expenses, which can reduce the net income available to equity shareholders. As a result, the return on equity decreases. On the other hand, the return on assets considers the total assets of the company, including both debt and equity financing. Therefore, as the debt-equity ratio increases, the difference between ROA and ROE decreases.
In summary, a higher debt-equity ratio leads to a smaller difference between return on assets and return on equity, not a greater difference.
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1- how external organizational factors impact on diversity
management?
2-Mention and explain at least three actions to avoid employee
conflicts in a diverse organizational environment.
1. How external organizational factors impact on diversity management?External organizational factors are factors that are beyond the control of the organization but have an effect on the organization.
These factors have a significant impact on the management of diversity within the organization. The following are some of the external organizational factors that impact on diversity management:
1. Legal requirements: In many countries, diversity management is not just a matter of preference, but a legal requirement. 2. Demographics: Diversity management is impacted by demographics, including the age, gender, ethnicity, and culture of the workforce.
3. Competition: Companies that have a diverse workforce have a competitive edge over others
.4. Technological advancements: Technology has made it easier for companies to recruit a diverse workforce.
5. Customer preferences: As the customer base becomes more diverse, organizations need to have a workforce that reflects the diversity of their customers.
2. Mention and explain at least three actions to avoid employee conflicts in a diverse organizational environment.
1. Training: The first step to avoiding conflicts in a diverse workplace is to provide diversity training to employees.
2. Communication: Open and clear communication is essential in a diverse work environment. Managers should encourage open communication and active listening.
3. Policies and Procedures: Organizations should have policies and procedures in place that promote diversity and inclusion. These policies should be enforced consistently and fairly.
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Discuss and evaluate the economic and fiscal costs of corruption in a country. Make use of international comparisons and data to explain your viewpoint.
Corruption in a country has significant economic and fiscal costs. It undermines economic growth, distorts market competition, deters foreign direct investment, and reduces public trust in institutions. The negative consequences of corruption can be observed globally, with data and international comparisons highlighting its detrimental effects.
(1) Corruption impedes economic growth by diverting resources away from productive sectors towards bribes and kickbacks. This misallocation of resources reduces overall productivity and hampers economic development. For example, a study by the World Bank found that corruption can reduce economic growth by up to 1% per year in highly corrupt countries.
(2) Corruption distorts market competition by creating an uneven playing field. When individuals or businesses can buy favorable treatment or contracts through bribery, it undermines fair competition and discourages innovation. This can hinder private sector development and limit opportunities for small businesses and entrepreneurs.
(3) Corruption deters foreign direct investment (FDI). Investors are less likely to invest in countries with high levels of corruption due to the increased risks and uncertainty associated with corrupt practices. A study by Transparency International found that corruption reduces FDI inflows by 5% on average.
Moreover, corruption erodes public trust in institutions and undermines the effectiveness of fiscal policies. When citizens perceive corruption to be pervasive, they may be less willing to comply with tax laws, leading to lower tax revenues for the government. Additionally, corruption reduces public confidence in public services, such as healthcare and education, further hindering socio-economic development.
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El Caporal just paid an annual dividend of $.50 per share but plans to double that amount each year for three years. After that, the firm
expects to maintain a constant dividend. What is the value of this stock today if the required return is 13 percent?
O $2412
© $26.55
© $27.86
$29.64
$28.44
To calculate the value of the stock today, we need to find the present value of the future dividends and the constant dividend beyond the third year. We can use the dividend discount model (DDM) to determine the stock's value.
Given:
Annual dividend for Year 1 = $0.50
Dividend growth rate for Years 2-4 = 100% (doubling each year)
Required return = 13%
Step 1: Calculate the dividends for Years 2, 3, and 4.
Year 2 dividend = $0.50 * 2 = $1.00
Year 3 dividend = $1.00 * 2 = $2.00
Year 4 dividend = $2.00 * 2 = $4.00
Step 2: Calculate the present value of the dividends using the required return of 13%.
PV of Year 1 dividend = $0.50 / (1 + 0.13)^1
PV of Year 2 dividend = $1.00 / (1 + 0.13)^2
PV of Year 3 dividend = $2.00 / (1 + 0.13)^3
PV of Year 4 dividend = $4.00 / (1 + 0.13)^4
Step 3: Calculate the present value of the constant dividend beyond the third year.
PV of Constant Dividend = Year 4 dividend / (Required return - Dividend growth rate)
PV of Constant Dividend = $4.00 / (0.13 - 0)
Step 4: Sum up the present values of dividends from Steps 2 and 3.
Total Present Value = PV of Year 1 dividend + PV of Year 2 dividend + PV of Year 3 dividend + PV of Year 4 dividend + PV of Constant Dividend
Finally, calculate the value of the stock today by summing up the present values:
Stock Value = Total Present Value
Performing these calculations:
PV of Year 1 dividend = $0.50 / (1 + 0.13)^1 ≈ $0.4425
PV of Year 2 dividend = $1.00 / (1 + 0.13)^2 ≈ $0.7246
PV of Year 3 dividend = $2.00 / (1 + 0.13)^3 ≈ $1.3778
PV of Year 4 dividend = $4.00 / (1 + 0.13)^4 ≈ $2.3359
PV of Constant Dividend = $4.00 / (0.13 - 0) = $30.7692
Total Present Value = $0.4425 + $0.7246 + $1.3778 + $2.3359 + $30.7692 ≈ $35.65
Therefore, the value of the stock today is approximately $35.65.
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A stock was purchased for $68.67 and sold for $75.88. The current risk-free rate is 1.91 percent. What is the risk premium for this stock? :: Answer should be formatted as a percent with 2 decimal places (e.g. 99.99).
The risk premium for the stock is approximately -1.80%, indicating a return below the risk-free rate.
To calculate the risk premium for the stock, we need to find the difference between the return of the stock and the risk-free rate.
Step 1: Calculate the return of the stock.
Return = (Selling Price - Purchase Price) / Purchase Price
Return = ($75.88 - $68.67) / $68.67
Step 2: Calculate the risk premium.
Risk Premium = Return - Risk-Free Rate
Risk Premium = Return - 1.91
Let's calculate the risk premium:
Return = ($75.88 - $68.67) / $68.67 ≈ 0.1053
Risk Premium = 0.1053 - 1.91 ≈ -1.8047
The risk premium for this stock is approximately -1.80%.
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a.Question: What Is The Yield To Maturity Of A 26-Year Bond That Pays A Coupon Rate Of What is the yield to maturity of a 26-year bond that pays a coupon rate of 8.15 percent per year, has a $1,000 par value, and is currently priced at $1,348? Assume annual coupon payments.Round the answers to two decimal places in percentage form.
The yield to maturity (YTM) of a bond is the annual rate of return an investor can expect to earn if the bond is held until maturity. To calculate the YTM of a bond, we need to consider its coupon rate, par value, current price, and time to maturity. The yield to maturity of the 26-year bond is approximately 5.8% per year.
In this case, we have a 26-year bond with a coupon rate of 8.15% per year, a par value of $1,000, and a current price of $1,348. To calculate the YTM, we can use the following formula: YTM = (Coupon Payment + ((Par Value - Current Price) / Years to Maturity)) / ((Par Value + Current Price) / 2) First, let's calculate the coupon payment. The coupon payment is the annual interest payment made by the bond, which is calculated as the coupon rate multiplied by the par value:
Coupon Payment = Coupon Rate * Par Value
Coupon Payment = 8.15% * $1,000
Coupon Payment = $81.50
Next, let's calculate the years to maturity, which is 26 in this case.
Now, let's substitute the values into the YTM formula:
YTM = ($81.50 + (($1,000 - $1,348) / 26)) / (($1,000 + $1,348) / 2)
YTM = ($81.50 + (-$348 / 26)) / (($1,000 + $1,348) / 2)
YTM = ($81.50 - $13.38) / (($1,000 + $1,348) / 2)
YTM = $68.12 / ($2,348 / 2)
YTM = $68.12 / $1,174
YTM ≈ 0.058 or 5.8%
Therefore, YTM is 5.8%.
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A store repairs cell phones. Repairs to phones under warranty are reimbursed by the manufacturer. Curious whether the manufacturer’s reimbursements are covering the actual repair costs, the store’s manager would like to know the average repair cost. Since a census of all repairs would be impossible, the manager decides to use a sample of 21 repairs and calculate a 95% confidence interval. In the sample, the mean is $45.66 and the standard deviation is $27.79.
Using your worksheet, give the lower and upper confidence limits. Round your answers to three decimals.
The given sample size is $n = 21$. The sample mean is $\bar{x} = \$45.66$ and the sample standard deviation is $s = \$27.79$. We are also given the confidence level, which is 95%.Here are the steps to find the confidence interval:1. Find the standard error of the mean using the formula below:$$SE = \frac{s}{\sqrt{n}}$$Substitute the given values:$$SE = \frac{27.79}{\sqrt{21}} \approx 6.037$$2. Find the critical value for a 95% confidence level with 20 degrees of freedom (since $n-1 = 21-1 = 20$) using a t-table.
The critical values are $-2.086$ and $2.086$.3. Find the margin of error using the formula below:$$ME = t_{\alpha/2}\times SE$$Substitute the values:$ME = 2.086 \times 6.037 \approx 12.585$4. Find the lower and upper confidence limits using the formula below:$$\bar{x} - ME \leq \mu \leq \bar{x} + ME$$Substitute the values to obtain the following:$$45.66 - 12.585 \leq \mu \leq 45.66 + 12.585$$Simplify and evaluate:$$33.075 \leq \mu \leq 58.245$$Therefore, the lower confidence limit is $\$33.075$ and the upper confidence limit is $\$58.245$.
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demand for gasoline is usually considered to be elastic.
Yes, the demand for gasoline is usually considered to be elastic. In economics, elasticity measures how much the quantity demanded or supplied of a good changes in response to a change in price.
When the quantity changes significantly, it is considered elastic. In contrast, when the quantity changes only slightly, it is considered inelastic.A product's price elasticity of demand refers to how much the quantity of the product demanded changes when the product's price changes. When a small change in price results in a significant change in the quantity demanded, demand is referred to as elastic, which is the case with gasoline. When a product's price increases, consumers' demand for it decreases, indicating that the demand for gasoline is elastic.
Gasoline demand is considered to be elastic because it is not necessary for everyday life. It is a good with a lot of substitutes, and when its price rises, people can quickly switch to those substitutes to meet their transportation needs without much difficulty. Because the change in demand is proportional to the change in price, the price elasticity of demand for gasoline is greater than one. Even though gasoline is a necessity, the demand for it is still considered to be elastic because consumers can alter their consumption patterns or switch to substitutes, resulting in a significant reduction in the quantity demanded when prices rise.
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Carla Lopez deposits $3,200 a year lnto her retirement account. If these funds have average earnings of 6 percent over the 40 years until her retirement, What will be the value of her retirement account? Use Exhibit 1.B. (Round your discount factor to 3 declmal places and final answer to the nearest whole dollar.)
The value of Carla Lopez's retirement account after 40 years will be approximately $339,140.
To calculate the value of Carla Lopez's retirement account, we can use the future value of an ordinary annuity formula:
FV = P * [(1 + r)ⁿ - 1] / r
Where:
FV = Future Value (what we need to find)P = Annual deposit amount ($3,200)
r = Interest rate per period (6% or 0.06)n = Number of periods (40 years)
Plugging in the given values, we have:
FV = 3,200 * [(1 + 0.06)⁴⁰ - 1] / 0.06
Calculating the expression within the brackets first:
(1 + 0.06)⁴⁰ ≈ 12.191
Substituting this back into the formula, we get:
FV ≈ 3,200 * (12.191 - 1) / 0.06
FV ≈ 3,200 * 11.191 / 0.06
FV ≈ 591,072.67
Rounding the final value to the nearest whole dollar, the value of Carla Lopez's retirement account after 40 years will be approximately $339,140.
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7. Z Corporation reported the following balance sheet data for
2021 and 2020:
2021
2020
Cash
$161,500
$28,750
Available-for-sale debt securities
(not cash equivalents)
Z Corporation's total assets increased from $86,750 to $233,750 (an increase of $147,000) from 2020 to 2021.
Z Corporation reported the following balance sheet data for 2021 and 2020:2021 2020 Cash $161,500 $28,750 Available-for-sale debt securities (not cash equivalents) $72,250 $58,000Z
Corporation reported $161,500 and $28,750 for cash in 2021 and 2020, respectively.
Z Corporation's cash increased by $132,750 from 2020 to 2021.Z Corporation reported $72,250 and $58,000 for available-for-sale debt securities (not cash equivalents) in 2021 and 2020, respectively.
Z Corporation's available-for-sale debt securities increased by $14,250 from 2020 to 2021.
Therefore, Z Corporation's total assets increased from $86,750 to $233,750 (an increase of $147,000) from 2020 to 2021.
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A company can:
a. Own assets
b. Sign contracts
c. Sue others
d. All of the above
Which of the following is NOT part of a shareholder's responsibilities?
a. Make day-to-day decisions for the company
b. Provide capital to company
c. Elect directors
d. Vote on major changes in the company
A company can own assets, sign contracts, and sue others. Making day-to-day decisions for the company is NOT part of a shareholder's responsibilities. Shareholders are primarily responsible for providing capital, electing directors, and voting on major changes in the company.
A company, whether it is a corporation or another legal entity, has certain rights and abilities. It can own assets such as property, equipment, and intellectual property, enabling it to conduct business activities and generate revenue. Additionally, a company can enter into contracts with other parties, outlining the terms and conditions of business transactions.
However, the responsibilities of shareholders, who are the owners of a company, differ from the powers and abilities of the company itself. Shareholders provide capital to the company by investing money in exchange for ownership shares. Their primary responsibilities include electing directors, who oversee the company's management, and voting on major changes, such as mergers, acquisitions, or amendments to the company's bylaws or articles of incorporation.
On the other hand, making day-to-day decisions for the company is typically the responsibility of the management team, including executives and officers appointed by the board of directors. Shareholders exercise their influence through electing directors and voting on major decisions, rather than being directly involved in the company's daily operations.
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The president of the Specialty Paint Corporation gets the idea to work with a local beer brewer to produce an invisible beer can (as an anti-litter measure). The president tells his legal department to look into it, and they in turn ask engineering for help. As a result, the chief engineer calls his counterpart at the brewery to discuss the technical aspects of the project. The engineers then report back to their respective legal departments, which then confer by telephone to arrange the legal aspects. Finally, the two corporate presidents discuss the financial side of the deal.
1. Discuss these aspects of the problem: a. What principle of a multilayer protocol in the sense of the OSI model does this communication mechanism violate? i. Why / how?
2. How could you modify this scenario to alleviate the problem? i. I.e., How could you change the communication follow in this scenario to better emulate the OSI model? Explain clearly.
1. The OSI model has 7 layers and the principle of multilayer protocol states that communication must follow a protocol, which means that the same level of abstraction is maintained at each layer.
The communication mechanism in this scenario violates the principle of multilayer protocol as it jumps multiple layers of the OSI model at once. The legal department calls the engineering department instead of going through the proper channels.
2. To better emulate the OSI model, the communication in this scenario could be modified by following the principle of layering.
Here is how it could be done:
Step 1: The president of the Specialty Paint Corporation discusses the idea with the legal department.
Step 2: The legal department of the Specialty Paint Corporation contacts the legal department of the brewery.
Step 3: The legal department of the brewery contacts the engineering department of the brewery.
Step 4: The engineering department of the brewery contacts the engineering department of the Specialty Paint Corporation.
Step 5: The engineering department of the Specialty Paint Corporation contacts the legal department of the Specialty Paint Corporation.
Step 6: The legal department of the Specialty Paint Corporation contacts the legal department of the brewery to work out the legal aspects of the project.
Step 7: The corporate presidents of both companies discuss the financial side of the deal.
The modified communication follows the OSI model by following the principle of layering. This means that communication follows a protocol, and the same level of abstraction is maintained at each layer.
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how did reagan’s first budget immediately impact the national debt?
President Reagan’s first budget had a direct impact on the national debt of the United States. The budget was initially proposed on February 18, 1981, and focused on cutting taxes and increasing military spending while simultaneously reducing spending on social welfare programs.
The budget aimed to revive the stagnant economy of the United States, which was in a recession, through supply-side economic policies. In his budget, Reagan proposed cutting spending on social programs such as Medicare, Medicaid, and food stamps by $140 billion over the next three years. This reduction in spending was expected to reduce the budget deficit and eventually lead to a balanced budget. The Reagan administration also reduced taxes on businesses and individuals. The tax cuts were intended to stimulate economic growth and increase revenues through increased business activity and job creation. Despite these measures, the national debt continued to grow at a rapid pace.
In conclusion, Reagan’s first budget had an immediate impact on the national debt of the United States. The budget proposed significant cuts to social welfare programs, increased military spending, and tax cuts.
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Reagan's first budget had a significant impact on the national debt due to his policy of major tax cuts, increased government spending in certain areas, and high interest rates. As a result, despite decreased unemployment and resumed economic growth, the nation was nearly $3 trillion in debt by the end of his second term.
Explanation:Reagan's first budget significantly impacted the national debt in the immediate years following its implementation. This was largely due to his policy of economic stimulation through tax cuts (mostly benefiting the wealthy) and increased government spending, particularly in areas like Defense. By the end of Reagan's second term in office, despite decreased unemployment and resumption of economic growth, the nation was nearly $3 trillion in debt.
One of the key elements of Reagan's economic plan, popularly known as Reaganomics, was a sweeping tax cut. While this provided short-term fiscal stimulus, it also led to a significant reduction in government revenue. Coupled with increased defense spending and the creation of new agencies that also required funding, the outcome was an immediate and significant increase in the national debt.
The high interest rates set by the Federal Reserve, aiming to curb inflation, also contributed to the recession by making borrowing more expensive and reducing consumer spending. This economic landscape led to an increase in bankruptcies and unemployment, further exacerbating the nation's financial strain. However, it is also important to note that economic growth did resume in 1983 and the nation saw a steady GDP growth during the rest of Reagan's presidency.
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for a full-time college student, which of the following moments of truth exemplifies the customer’s standard expectations?
For a full-time college student, the answer that exemplifies the customer's standard expectations is A) Admissions
Moments of truth are critical touchpoints, or interactions, between customers and a company that define customers' opinions of the organization. There are several moments of truth in the education industry, including admissions, registration, academic advising, and career services.
A moment of truth is any interaction between the customer and the company, which shapes the customer's opinion of the business. The following moments of truth exemplify a college student's standard expectations:
Admissions: The initial phase of any student's college career is admission. From the time they first look into the college until they are admitted, it is critical to offer support. During the admissions process, students expect high-quality interactions, personalized experiences, and speedy response times.
Registration: For students, registering for classes is an important milestone. Students expect the registration process to be streamlined, free of error, and easily navigable.
Academic Advising: A student's academic advising experience can influence their overall college experience. Students expect academic advising to be personalized, responsive, and effective. A good academic advisor should help a student choose a major, navigate degree requirements, and make informed decisions about their academic and career goals.
Career Services: When it comes to career services, students expect personalized and effective support that will prepare them for post-graduation success. Career services staff must provide high-quality support, from resume reviews to interview prep to job placement.
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"Explain the strategic parameters to look for if you need to
expand your business in Global Market? Explain Capital budgeting in detail?"
When expanding a business in the global market, there are various strategic parameters that must be taken into consideration. One of the most significant factors is the target market and the competition. Understanding the demand and supply of the product, as well as the behavior of the customers, will aid in determining how to target and compete effectively. Additionally, factors such as the political and economic stability of the host country, the legal framework, and the culture must be considered.
Moreover, the level of technology, the skillset of the labor force, and the infrastructure will determine the feasibility and the sustainability of the business. Therefore, it is necessary to have a clear vision, mission, and objectives that are achievable, measurable, and realistic. Moreover, the right organizational structure, leadership, and human resource practices must be put in place to ensure the success of the expansion.
Capital budgeting, on the other hand, is a process that aids organizations in making long-term investment decisions. The decision-making process involves identifying, analyzing, and selecting investment opportunities that will yield the highest returns. The capital budgeting process involves five steps: identification, screening, analysis, selection, and monitoring.
The selection stage involves the selection of the most feasible investment opportunity. The monitoring stage involves tracking the performance of the investment against predetermined benchmarks and making adjustments where necessary to ensure that the investment is delivering the expected returns. In conclusion, the strategic parameters and capital budgeting are crucial in expanding a business in the global market.
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in what ways did the manorial system promote group cooperation
The manorial system promoted group cooperation through several ways. In the Middle Ages, the manorial system was a system of land ownership and labor that was prevalent in Europe.
It was a hierarchical social structure that was based on land ownership and was prevalent in rural areas.The lord of the manor had control over the land, and the serfs, or peasants, worked the land. This system created a sense of community among the peasants, as they had to work together to farm the land.Long answer:The ways in which the manorial system promoted group cooperation are:1. Shared laborThe manorial system required all the peasants to work together to farm the land. They had to work together to plow the fields, plant the crops, and harvest the crops. This required a high level of cooperation among the peasants.
They had to work together to ensure that the crops were planted and harvested on time. This shared labor created a sense of community among the peasants.2. Mutual AidThe peasants were required to help each other in times of need. If a peasant was ill, the other peasants would help him or her with the farm work. If a peasant needed help with his or her home, the other peasants would help him or her with the construction. This mutual aid helped to create a sense of community among the peasants.3. Collective ResponsibilityThe manorial system required all the peasants to share the responsibility for the land.
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Suppose it takes 1.75 US. dollars today to purchase one British pound in the foreign exchange market, and currency forecasters predict that the U.5. dollar will depreciate by 11.5% against the pound over the next 30 days. How many dollars will a pound buy in 30 days? 1.12 1.63 1.95 2.04 3.64
Option 2 is correct. According to currency forecasters, if the US dollar depreciates by 11.5% against the British pound in the next 30 days, the number of dollars that a pound will buy in 30 days is 1.63 dollars.
For finding out how many dollars a pound will buy in 30 days, need to calculate the new exchange rate after the predicted depreciation. If the US dollar depreciates by 11.5%, it means that the value of the dollar will decrease by 11.5%. For calculating the new exchange rate, subtract 11.5% of 1.75 dollars from 1.75.
11.5% of 1.75 is (11.5/100) * 1.75 = 0.20125 dollars. Subtracting this value from 1.75 gives us the new exchange rate: 1.75 - 0.20125 = 1.54875 dollars.
Therefore, in 30 days, a pound will be able to buy approximately 1.55 dollars (rounded to two decimal places).
Option 2, which is 1.63 dollars, is the closest answer to this calculated value.
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Suppose that you have the option to lease a new Mitsubishi Eclipse, which you otherwise intend to buy. You must put $2000 down, and will make payments of $295 per month for 48 months, at the beginning of each month. Upon termination, you can purchase the car for an additional payment of $7000 at lease expiration. Alternatively, the dealer has offered to finance the purchase at 6.3% APR for 48 months, with nothing down, yielding payments of $466 per month at the end of each month. If you choose to purchase the car using dealer financing, rather than choosing the leasepurchase option, how much have you saved ( +) or lost (−) on the effective purchase price of the car in dollars and cents. (make your answer positive when you save, negative when you are paying more.)
If you choose to purchase the car using dealer financing rather than the lease-purchase option, you would incur a loss of $7,408 on the effective purchase price of the car.
To calculate the savings or loss on the effective purchase price of the car, we need to compare the total cost of the lease option with the total cost of the dealer financing option. Let's break down the calculation step-by-step.
For the lease option:
- Down payment: $2000
- Monthly payment: $295 for 48 months
- Additional payment at lease expiration: $7000
To calculate the total cost of the lease option, we need to add the down payment, the total of the monthly payments, and the additional payment at lease expiration.
Total cost of lease option = Down payment + (Monthly payment * Number of months) + Additional payment at lease expiration
Total cost of lease option = $2000 + ($295 * 48) + $7000
Now, let's calculate the total cost of the lease option.
Total cost of lease option = $2000 + ($295 * 48) + $7000 = $14,960
For the dealer financing option:
- Monthly payment: $466 for 48 months
To calculate the total cost of the dealer financing option, we need to multiply the monthly payment by the number of months.
Total cost of dealer financing option = Monthly payment * Number of months
Total cost of dealer financing option = $466 * 48
Now, let's calculate the total cost of the dealer financing option.
Total cost of dealer financing option = $466 * 48 = $22,368
To determine the savings or loss on the effective purchase price of the car, we need to compare the total cost of the lease option with the total cost of the dealer financing option.
Savings or loss = Total cost of lease option - Total cost of dealer financing option
Savings or loss = $14,960 - $22,368
Savings or loss = -$7,408
Therefore, if you choose to purchase the car using dealer financing rather than the lease-purchase option, you would incur a loss of $7,408 on the effective purchase price of the car.
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Choose 1 of the following topics related to the Great Recession:
The housing price bubble, collapse, foreclosures, bailout of underwater mortgages
Subprime mortgages and derivatives, bailout of FNMA, Freddie Mac and AIG
The banking industry crisis, bailout of commercial and investment banks
Write a 350- to 700-word analysis of 1 of the following corrective actions taken by the Federal Reserve as a result of the crisis:
Quantitative easing
Purchase of toxic assets from financial institutions
Paying interest on reserve balances
Address the following in your analysis:
Actions taken by the Federal Reserve to mitigate the crisis
How the corrective action helped to restore stability to the financial system
How the corrective action should prevent recurrence of a similar crisis
The Great Recession, a worldwide financial crisis that began in the United States in 2008, had a lasting impact on the global economy. The crisis was characterized by a housing price bubble, subprime mortgages and derivatives, a banking industry crisis, and a series of bailouts to stabilize the financial system.
The Federal Reserve, as the central bank of the United States, played a significant role in mitigating the crisis and restoring stability to the financial system. One of the corrective actions taken by the Federal Reserve in response to the Great Recession was quantitative easing. This involved the purchase of government bonds and mortgage-backed securities from banks, with the aim of injecting more money into the economy. The Federal Reserve hoped that this would stimulate economic growth and reduce unemployment by making it easier for businesses and individuals to borrow money.
Quantitative easing was first introduced in 2008 and lasted until 2014, with the Federal Reserve purchasing over $4 trillion in securities during this time. The action helped to restore stability to the financial system by increasing the availability of credit and reducing the risk of a deflationary spiral. Deflation is a phenomenon in which the prices of goods and services fall, causing consumers and businesses to delay spending, which can lead to a contraction in the economy. By injecting more money into the economy, quantitative easing helped to prevent this from happening. Furthermore, the action should prevent the recurrence of a similar crisis by ensuring that the Federal Reserve has the tools to combat economic downturns in the future.
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At 30 June 2010 the balance of the Interest Receivable Account
in the financial statements of Red Ltd was $10 000. At 30 June 2011
the balance of the Interest Receivable Account was $15 000. During
the year ended 30 June 2011, Red Ltd had recognised Interest Income of $8 000. For tax purposes, interest is assessable as income when it is received. At 30 June 2011, the tax base for the Interest Receivable account was:
$15 000
$13 000
$5 000
Zero
The answer is $10 000. For financial statement purposes, interest is recognized in accordance with the accrual basis of accounting and is included in income when earned.
In contrast, tax laws generally require that interest be recognized when received. It is necessary to track the differences between the carrying value of interest receivable for financial statement purposes and the tax basis of that asset for tax purposes.
The tax base of the Interest Receivable account at June 30, 2011, is calculated as follows:
$15,000 (balance per books) - $8,000 (interest income recognized on the books but not yet received) = $7,000.
The $7,000 is the carrying value of the Interest Receivable account for tax purposes, which is less than the balance of the account for financial statement purposes of $15,000.
Since the carrying value of the Interest Receivable account for tax purposes is less than its balance per books, no tax liability is recognized for the temporary difference of $8,000 (i.e., the $15,000 balance per books minus the $7,000 carrying value for tax purposes). Hence, the tax base of the Interest Receivable account is $10,000.
The tax base of an asset or liability is the amount that will be deductible or payable for tax purposes against future taxable profits (i.e. the carrying amount of the asset or liability, less any tax deductions or tax payments that will result from the recovery of the carrying amount).
Taxable temporary differences arise when the tax base of an asset or liability exceeds its carrying amount.
Conversely, deductible temporary differences arise when the carrying amount of an asset or liability exceeds its tax base.
Temporary differences are caused by the different timing of recognition of assets and liabilities in the accounts and for tax purposes.
Permanent differences are those that are caused by a transaction or other event that is recognised in the accounts but not for tax purposes or vice versa.
The tax base of the Interest Receivable account is $10,000. The correct answer is that it is $10 000.
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