Suppose Sally borrows $1,000 from Harry for one year and agrees to pay a nominal interest rate of 10%. When she borrows the money, both she and Harry expect an inflation rate of 5%.
The expected real interest rate on the loan is _______ %.Suppose that when Sally pays back the loan after one year, the actual inflation rate turns out to be 2%. The actual real interest rate on the loan is ________ %.a. If the inflation rate turned out to be higher than expected, then:_________. b. But if inflation turned out to be lower than expected, then:________.

Answers

Answer 1

Answer:

The expected real interest rate on the loan is 5%.Suppose that when Sally pays back the loan after one year, the actual inflation rate turns out to be 2%. The actual real interest rate on the loan is 8%.

a. If the inflation rate turned out to be higher than expected, then: the real interest rate would be lower than expected.

b. But if inflation turned out to be lower than expected, then: the real interest rate would be higher than expected.

Explanation:

Expected real interest rate = nominal interest rate - expected inflation = 10% - 5% = 5%

Actual interest rate = nominal interest rate - actual inflation rate = 10% - 2% = 8%


Related Questions

The main goals of an engineering ethics class if to memorize the professional codes of ethics as formulated by professional organizations like the NSPE.
a. True
b. False

Answers

Answer:

a. True

Explanation:

NSPE stands for National Society of Professional Engineers. It is a professional association or a professional society which represents the licensed professional engineers in the United States of America.

The NSPE code of ethics for the engineers are the guideline of their professional works with honesty and integrity. It teaches the engineers to perform their professional  duty with high principles of the ethical conduct.

Thus the main objective of an engineering ethics class is to make the engineers learn about the ethical conducts in their profession and memorize them and practice while delivering work as a professional.

Mark this question Brian discussing the financial position of his company with Mike, who is interested in acquiring Brian's company, is an example of which of the following? A. Managerial accounting B. Investment accounting C. Financial accounting D. External accounting

Answers

Answer:

B. Investment accounting

Explanation:

Investment accounting focuses on the management of assets of the business. this also includes valuations when considering a sell, a merger or acquisition of the business.

In this question, Mark wants to acquire Brian's company so he is making an investment decision.

The given situation represent the Financial Accounting

The following information should be considered;

Financial accounting means the process of identifying, classifying, recording, summarizing, analyzing & reporting the financial information of an entity to all the stakeholders of the company.So, in the given situation, it is the financial accounting example.

Learn more; https://brainly.com/question/17429689?referrer=searchResults

A ten-year $2,000,000 bond is issued on January 1, 20xx with a 5% stated interest rated. Interest is paid semiannually on June 30 and December 31st. What is the amount that would be recorded as interest expense on June 30, 20xx (the first interest payment), assuming that no interest expense has been recorded since the bond was issued on January 1st

Answers

Answer:

the amount of interest expense as on June 30 is $50,000

Explanation:

The computation of the amount of interest expense as on June 30 is shown below

= Bond amount × rate of interest × number of months ÷ total number of months

= $2,000,000 × 5 months × 6 months ÷ 12 months

= $50,000

hence, the amount of interest expense as on June 30 is $50,000

We simply applied the above formula so that the correct value could come

And, the same is to be considered

True or False: Capital budgeting, capital structure, and dividend policy decisions are important to managers and shareholders because their consequences can affect the amount, timing, and riskiness of the cash flows produced by the firm and its securities.

Answers

Answer:

I would go with true.

Explanation:

Shareholders want there shares to increase, so they would like the company to make good business decisions.

In an ideal world if you manage a companies budgeting and structure perfectly you would have no risk involved in the cash flow.

Hope I helped!

Satellite Systems modified its model Z2 satellite to incorporate a new communication device. The company made the following expenditures:
Basic research to develop the technology $3,900,000
Engineering design work 1,180,000
Development of a prototype device 590,000
Testing and modification of the prototype 390,000
Legal fees for patent application 79,000
Legal fees for successful defense of the new patent 39,000
Total $6,178,000
During your year-end review of the accounts related to intangibles, you discover that the company has capitalized all the above as costs of the patent. Management contends that the device represents an improvement of the existing communication system of the satellite and, therefore, should be capitalized.
4. value:
1.92 points
Required information
Required:
1. Determine the amount Satellite Systems should capitalize to the Patent account in the balance sheet.
5. value:
1.92 points
Required information
2. Determine the amount Satellite Systems should report as research and development expense in the income statement.

Answers

Answer: See explanation

Explanation:

a. Determine the amount Satellite Systems should capitalize to the Patent account in the balance sheet.

This would be:

Legal fees for application of patent = $79,000

Add: Legal fees for successful defense of new patent = $39000

Total cost = $79000 + $39000 = $118,00

b. Determine the amount Satellite Systems should report as research and development expense in the income statement.

This would be:

Basic research in developing technology = $3,900,000

Add: Engineering design work = $1,180,000

Add: Development of prototype device = $590,000

Add: Testing and modification of prototype = $390,000

Total = $6,060,000

Why do company manager-owners smile when they ring the stock exchange bell at their ipo?A. An IPO's price goes up on the first day, generating guaranteed returns for investors. B. Manager-owners are freed of the burden of managing their company. C. An IPO reveals the value of the manager-owners' stake. D. Manager-owners receive their first stake in the company at an IPO.

Answers

Answer:

The correct option is C. An IPO reveals the value of the manager-owners' stake

Explanation:

The reason company manager-owners smile whenever they ring the stock exchange bell at their ipo which full meaning is INITIAL PUBLIC OFFERING is that it will show them the value of their owners stake which is the percentage of the value of the stock the manager own .

Submit your project calculating the financial ratios of a publicly traded company. Be sure to follow WILL MARK BRANLIEST these guidelines:
• Identify the publicly traded company you selected.
• List the four financial ratio categories and the ratio you have chosen from each category.
• Show the data you used from the annual report and how you calculated the four financial ratios.
• Show the four ratios.

Answers

Answer:

what grade is this?

Explanation:

is the college???

I found this off the internet: Government security agencies like the NSA can also have access to your devices through built-in back doors. This means that these security agencies can tune in to your phone calls, read your messages, capture pictures of you, stream videos of you, read your emails, steal your files … whenever they please

Answers

Answer:

Well isn't that just great. Well my family is crazy and there is always something going on. I bet we must be pretty fun to watch. XD. I can't imagine what the government thinks about my fam. And we are always joking about murder and stuff. I am prolly on some watch list for the crazy people.

Explanation:

My fam is just a bunch of funny crazy people.

The right of common shareholders to purchase their proportional share of any common stock later issued by the corporation is called a:

Answers

Answer:

Preemptive right

Explanation:

The right of common shareholders to purchase their proportional share of any common stock later issued by the corporation is called a Preemptive right. A preemptive right grants right to existing shareholders to buy some proportion of new shares at a price lower than market price

Marigold Corp. constructed a building at a cost of $13600000. Weighted-average accumulated expenditures were $5700000, actual interest was $560000, and avoidable interest was $280000. If the salvage value is $1110000, and the useful life is 40 years, depreciation expense for the first full year using the straight-line method is $326250. $319250. $347000. $461750.

Answers

Answer:

$121,750

Explanation:

Cost of the building = 13600000

Average accumulated expenses = 5700000

Actual interest = 560000

Avoidable interest = 280000

Salvage value = 1110000

Life in years = 40 years

Depreciation expenses for 1st full year = {(Average accumulated expenses + Avoidable interest) - Salvage value} / Life in years

Depreciation expenses for 1st full year = (5700000 + 280000 - 1110000) / 40

Depreciation expenses for 1st full year = 4870000 / 40 years

Depreciation expenses for 1st full year = $121,750

What is one way investment consultants protect their clients’ money during periodic performance reviews?

Answers

Answer:

Investment consultants check that the portfolio manager's performance was based on skill investing in the agreed-upon stocks or sectors

Explanation:

because it is

In a bid to ensure that money is adequately channeled and client's finances are safe, investment consultant analyses the stocks and portfolio's in other to ensure they are based on the advise offered and agreed upon.

The investment consultant offers expert advise on profitable stocks and portfolio's which could be invested in.

The portfolio manager handles and monitors client's investment and finances.

Hence, the investment consultant and portfolio manager work hand in hand in other to ensure that the right stock is chosen and invested in.

Therefore, investment consultant ensures that portfolio managers do not deviate from the agreement made.

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If the dividend yield for year 1 is expected to be 5% based on a stock price of $25, what will the year 4 dividend be if dividends grow annually at a constant rate of 6%

Answers

Answer:

$1.33

Explanation:

Calculation for what will the year 4 dividend be

Using this formula

Year 4 dividend=[(Expected dividend yield×Stock price)×(1+Constant rate )]

Let plug in the formula

Year 4 dividend = [(.05 × $25) × (1+0.06)]

Year 4 dividend=(.05 × $25) × 1.06

Year 4 dividend=1.25×1.06

Year 4 dividend= $1.33

Therefore what will the year 4 dividend be if dividends grow annually at a constant rate of 6% is $1.33

DVC stock has a required return of 25%. The expected market return is 15% and the risk-free rate is 5%. What is the beta of the DVC stock

Answers

Answer:

2

Explanation:

As per CAPM, Required Return = Risk Free rate + (Market Return - Risk Free Rate ) * Beta

25% = 5% + (15%-5%)*Beta

25% = 5%+10%*Beta

25% - 5% = 10%*Beta

Beta = (25%-5%)/10%

Beta = 20% / 10%

Beta = 2

Thus, the beta of the DVC stock is 2

Doing business in the financial markets most fundamentally presupposes that _______ will be respected.

Answers

Answer:

Ideas

Explanation:

While doing the business in the financial market the fundamental thing that prior supposed is that of ideas which could be respected

With the ideas of an individual, the individual could accomplish their targets and if there is no ideas than it is impossible to accomplish their goals and objectives

Therefore the ideas would be the answer

Rabid Manufacturing Company has the following data:
Direct labor $145,000
Direct materials used 151,000
Total manufacturing overhead 208,000
Beginning work in process 26,000
Compute total manufacturing costs.
Total manufacturing costs $_________
Compute total cost of work in process.
Total cost of work in process $__________

Answers

Answer:

Total manufacturing costs $504,000

Total cost of work in process $530,000

Explanation:

Calculation for Total manufacturing costs

Direct labor $145,000

Direct materials used 151,000

Total manufacturing overhead 208,000

Total manufacturing costs $504,000

Calculation for Total cost of work in process

Direct labor $145,000

Direct materials used 151,000

Total manufacturing overhead 208,000

Beginning work in process 26,000

Total cost of work in process $530,000

Therefore Total manufacturing costs is $504,000 and Total cost of work in process is $530,000

How the big crunch happen according to the steffen hawking?​

Answers

Answer:

Before he passed away in March, theoretical physicist Stephen Hawking had published more than 230 articles on the birth of the universe, black holes and quantum mechanics. It turns out he had one more theory left in the locker.

On Wednesday, the Journal of High Energy Physics published the British scientist's final thoughts on the Big Bang, the leading theory for how the universe began. The new report, co-authored by Belgian physicist Thomas Hertog, counters the longstanding idea that the universe will expand for eternity. Instead, the authors argue the Big Bang had a finite boundary, defined by string theory and holograms.

A task has an optimistic completion time of 4 days, a most likely time of 10 days, and a pessimistic time of 13 days. The expected task duration is:

Answers

Answer: 9.5 days

Explanation:

The following can be deduced from the question:

Optimistic Time (To) = 4 days

Most likely Time (Tm) = 10 days

Pessimistic Time (Tp) = 13 days

Expected Task Duration (Te) will then be calculated as:

= (To + 4Tm + Tp) / 6

= (4 + 4×10 + 13) / 6

= (4 + 40 + 13)/6

= 57 / 6

= 9.5 days

How many jobs do retail sales support in the United States?
O 4 million
O 24 million
O 42 million
O 240 million

Answers

Answer:

Hey mate here's your answer ⤵️

42 million jobs

The retail sector continues to grow. Total retail sales (including motor vehicle and parts sealers) from 1 million retail establishments in the United States surpassed $5 trillion in 2017. The U.S. retail industry directly employs about 29 million people and supports more than 42 million jobs.

Hope it was helpfulll

The retail sales sector support 42 million jobs in the United States. Thus, the correct answer is option C.

What is retail sales?

Retail sales are the sales of consumer goods, or final goods, by businesses to end users, and include both in-store and online sales. Products can be either durable (with a long expected shelf life) or perishable (such as groceries). Consumer goods include things like food, clothing, and furniture.

The retail industry is expanding. Total retail sales (including motor vehicle and parts sealers) from the United States 1 million retail establishments surpassed $5 trillion in 2017. The retail industry in the United States directly employs approximately 29 million people and supports over 42 million jobs.

Therefore, option C is correct.

To learn more about retail sales, click here:

https://brainly.com/question/17839189

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End of Semester Test:
ПВА
6
Select the correct answer.
Stears Corp. paid interest on loan of $3,500 by check. What will the entry in the journal of the company be?
OA. Interest on Loan account (debit) Cash in Bank account (credit)
ОВ. .
Cash in Bank account (debit) Interest on Loan account (credit)
Ос. .
Interest on Loan account (debit) Loan account (credit)
OD.
Loan account (debit) Interest on Loan account (credit)
OE.
Loan account (debit) Cash in Bank account (credit)
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Answers

Answer:

Explanation:

the awners is b because it shows understaing of what people do

One unusual feature of the UCC is the so-called "battle of forms" concept, under which additional terms from the forms used by the merchants involved become part of their contract unless there is an objection on a timely basis. Read the attached opinion in J.W.S. Delavau, Inc. v. Eastern America Transport & Warehousing, Inc., which is from a Philadelphia case. What is your view of the decision that was reached by the court?

Answers

Answer:

The decision reached by the court was valid, in my view.  Since the parties, Delavau, Inc. and Eastern Warehousing, Inc. had a valid contract in which they set out their understanding and agreement on the terms of their business relationship, the parties should follow the contract terms without distractions from pre-printed Form terms.

Having a formal contract is the only way to avoid the battle of forms.

Explanation:

The conflict involved a battle of conflicting forms.  This battle of conflicting form, with different contract terms, occurred when Delavau, Inc. and Eastern Warehousing, Inc. exchanged contract terms, with Eastern's own small print terms on the reverse side its own receipts, which it wanted Delavau to comply with.  That the court held that Delavau was not bound by Eastern's form terms was valid because their contract agreement specified the terms of their relationship, which cannot be negated by the form terms.

To record estimated uncollectible accounts using the allowance method, the adjusting entry would be a

Answers

Answer:

Bad debt expense

      To Allowance for doubtful accounts

(Being the bad debt expense is recorded)

Explanation:

The adjusting entry using the allowance method for recording the predicted uncollectible account is as follows:

Bad debt expense

      To Allowance for doubtful accounts

(Being the bad debt expense is recorded)

Here the bad debt expense is debited as it increased the expenses and credited the allowance for doubtful account as it decreased the assets

Therefore the above represent the bad debt expense

If $500 is invested at an annual interest rate of 8% per year, its future worth at the end of 30 years will be most nearly:_________. a. $1, 200 b. $1, 700 c. $5, 031 d. $15,000

Answers

Answer:

c. $5,031

Explanation:

The value of amount the dollar invested today is going to be worth in Future is known as its Future Value.

The Future Value is calculated using Time Value of Money techniques. Here i will specifically use a financial calculator as below :

PV = - $500

I = 8%

N = 30

PMT = $0

P/YR = 1

FV = ?

Inputting the values as shown gives a Future Value of  $5,031

The future worth at the end of 30 years will be most nearly be c. $5, 031

OneChicago has just introduced a single-stock futures contract on Brandex stock, a company that currently pays no dividends. Each contract calls for delivery of 1,000 shares of stock in 1 year. The T-bill rate is 6% per year. a. If Brandex stock now sells at $120 per share, what should the futures price be

Answers

Answer: $127.20

Explanation:

Based on the scenario in the question, if Brandex stock now sells at $120 per share, the futures price would be:

T-bil rate = 6%

Stock Price = $120

Future price = $120 × (1 + 6%)

= $120 × (1 + 0.06)

= $120 × 1.06

= $127.20

Determine the price in period 1 (the future) if 30 units of oil are consumed in period 0 (the present).

Answers

Answer:

$16.50

Explanation:

Note: The complete question is attached as picture below

We know that there is a total of 90 units of oil and 30 units is consumed in period 0.

So, in period 1, the consumption amount will be = 90-30=60 units.

So, Q1 = 192 - 8P

For 60 units, the price will be 60 = 192 - 8P

8P = 192 - 60

8P = 132

P = 132 / 8

P = 16.5

So, the price in period 1 is $16.50

a seller and a broker enter into a six month agreement where the seller agrees to pay a commission to the broker, regardless of who actually sells the property. What type of cotnract is this?

Answers

Answer:

exclusive right to sell

Explanation:

The exclusive right to sell is an agreement between the seller and broker in which the broker received the commission from the seller irrespective who actually sales the property

Therefore as per the given situation, since there is an agreement done between both the parties for 6 months and the same criteria is to be followed

So it is a exclusive right to sell

A seller can create value in a customer relationship by nurturing the customer's trust and developing it into____.

Answers

Answer:

Loyalty.

Explanation:

This is seen in different forms in a human being. In an organisational or marketing setting, it is seen to be dicey and do not come by easily; as the quality of the commodity play also key role in getting a customer's loyalty. Such customers are seen to have good raport as good interaction principles and techniques have been used in getting a marketing approach that seem to have made them happy. This form of relationship can be seen to go beyond buying and selling as the customer can be seen to shower or receive other forms of kindness in the process.

The Federal Reserve mandates that banks must keep a certain percentage of money on hand at particular times. What is this referred to as?a. Reserve requirementb. Mandated moneyc. M1d. Ratio of reservatione. M3

Answers

Answer:

a. Reserve requirement

Explanation:

As we know that the bank must hold the money percentage of the deposits made in cash as per the federal reserve so the same we called as a reserve requirement.

It is mandatory to keep the specific percentage for particular times

Therefore as per the given situation, the option a is correct

And, all the other options are incorrect

A collaborative selling environment makes the sales pitch more challenging for salespeople.
O True
O False

Answers

Answer: True

Explanation:

Collaborative selling simply refers to a sales approach whereby both the buyer and seller collaborate that is, work together in order to get a convenient and suitable purchase.

It should be noted that a collaborative selling environment makes the sales pitch more challenging for salespeople. Therefore, the answer is true.

At her death Serena owned real estate worth $210,000 with her spouse in joint tenancy with the right of survivorship. Serena contributed $50,000 to the original cost of the property and her spouse contributed the remaining $100,000. What amount, if any, is included in Serena's gross estate?

Answers

Answer: $105000

Explanation:

From the question, we are informed that Serena owned real estate worth $210,000 with her spouse in joint tenancy with the right of survivorship when she died and that she contributed $50,000 to the original cost of the property and her spouse contributed the remaining $100,000.

The amount, that will be included in Serena's gross estate will be:

= $210,000 × 50%

= $210000 × 0.5

= $105,000

It should be noted that only 50% will be included since she owes the property with her spouse in joint tenancy.

Which one of the following accounts will be debited when making closing entries?
a. Cost of goods sold
b. Sales Revenue
c. Cash
d. Accounts Payable

Answers

Answer:

b. Sales Revenue

Explanation:

You need to close temporary accounts, i.e. those included in the income statement. Sales revenue is closed against income summary account, the same as cost of goods sold. But in order to close cost of goods sold you must credit the account, not debit it. Cash and accounts payable are permanent accounts that are not closed at the end of the accounting period.

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