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2 years ago

Which of the following is TRUE about owning a share of stock?

Business

1 answer:

MAVERICK [17]2 years ago

6 0

Answer:

The correct answer is letter "B": Owning a share means you own a percentage of the company.

Explanation:

A share which is also called a stock is a corporate or financial asset ownership unit. Owning some shares in the business entitles the holder to a proportionate amount of the company's profits. Profits are called dividends when they are paid to shareholders.

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A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 8.6%, and sells for $1,140. Interest is

nordsb [41]

Answer:

Price of bond=948.8583731

Explanation:

The value of the bond is the present value(PV) of the future cash receipts expected from the bond. The value is equal to present values of interest payment plus the redemption value (RV).

Value of Bond = PV of interest + PV of RV

Semi-annual interest = 8.6% × 1,000 × 1/2 =43

Semi-annual yield = 9.4%/2=4.7 %

PV of interest payment

PV = A (1- (1+r)^(-n))/r

A- 43, r-0.047, n- 20

= 43× (1-(1.047)^(-10)/0.047)

= 549.7724893

PV of redemption Value

PV = F × (1+r)^(-n)

F-1000, r-0.047, n- 20

PV = 1,000 × 1.047^(-20)

PV = 399.0858837

Price of Bond

549.772 + 399.085

=948.8583731

4 0

2 years ago

Jane Thorpe has been offered a seven-year bond issued by Barone, Inc., at a price of 943.22. The bond has a coupon rate of 9 per

Lapatulllka [165]

Answer:

Yes

Explanation:

Given:

F = 1000$

n = 7

Coupon rate = 9%, because it pays the coupon semiannually, so

=> Coupon payment = 1000*9%/2 = 45

Current market rate, YMT= 10%

So the current value of bond is:

C(1- (1+r)^(-n)/r + F/( $(1+r)^{n}$

<=>45(1 - (1+0,1)^(-7/0.1)) + 1000(1+0,1)^7

<=> C = $951

So she will buy the bonds at the offered price 943.22 because it is smaller than $951

4 0

2 years ago

a. If Alpha produced 6 pearls and 15 pineapples while Beta produced 30 pearls and 8 pineapples before they decided to trade, how

Mazyrski [523]

Answer:

Alpha will produce no pearls and Beta will produce 60 pearls, increasing the combined production from 36 pearls.

Explanation:

A comparative advantage of a country is defined if the country is able to produce a product with the least opportunity cost than its trade partner countries.

So first we calculate the cost of producing each good for each of the countries.

For Alpha:

1 pearls = 15/6 pineapples

1 pearls = 2.5 pineapples

Similarly,

1 pineapple = 6/15 pearls

1 pineapple = 0.4 pearls

So for Alpha, the opportunity cost of producing one pearl is 2.5 pineapple, to produce 1 pineapple, Alpha has to sacrifice 0.4 pearls.

Opportunity cost for Beta:

1 pearls = 8/30 pineapples

1 pearls = 0.27 pineapples

Similarly:

1 pineapple = 30/8 pearls

1 pineapple = 3.75 pearls

So for Beta, the opportunity cost of producing one pearl is 0.27 pineapple, to produce 1 pineapple, Alpha has to sacrifice 3.75 pearls.

It can be seen that the opportunity cost of producing pineapples is least for Alpha, Beta has the lowest opportunity cost for producing pearls. So Alpha will export pineapples while Beta will export pearls.

Thus if both decide to trade produce only that good in which it has the opportunity cost, then Alpha's production of pineapple will be

15 + 2.5 X 6 = 15+15 = 30 pineapple

While Beta's production of pearls will be

30 + 3.75 X 8 = 30 + 30 = 60 pearls.

So Alpha will produce no pearls and Beta will produce 60 pearls, increasing the combined production from 36 pearls.

3 0

2 years ago

Reporting Financial Statement Effects of Bond Transactions Lundholm, Inc., which reports financial statements each December 31,

saw5 [17]

Answer:

Lundholm, Inc

Journal Entries

Date Account Titles Debit Credit

May 1, 18 Cash $500,000

Bonds payable $500,000

(To record the bond issuance)

31 Oct, 18 Interest Expenses $22,500

(500000*9%*6/12)

Cash $22,500

(To record payment of the first semiannual period’s interest)

Nov 1, 19 Bonds payable $300,000

Loss on Bonds $3,000

Cash $303,000

(To record retirement the bonds at 101 on November 1, 2019)

8 0

2 years ago

Suppose there are only three firms in a market. The largest firm has sales of $500 million, the second-largest has sales of $300

belka [17]

Answer:

50% share.

Explanation:

Given:

There are only three firms in a market.

The largest firm has sales of $500 million.

The second-largest has sales of $300 million.

The smallest has sales of $200 million.

Question asked:

The market share of the largest firm is ?

Solution:

As we know:

$Market\ share=\frac{Total\ sales\ of\ the\ firm}{Total\ sales\ of\ the \ market} \times100$

Total sales of the largest company = $500 million.

Total sales of the market = Sales of largest firm + Sales of second largest firm+ Sales of smallest firm

Total sales of the market = $500 million + $300 million + $200 million

= $1000 million

$Market\ share=\frac{Total\ sales\ of\ the\ firm}{Total\ sales\ of\ the \ market} \times100$

$=\frac{500}{1000} \times100\\ \\ =\frac{50000}{1000} \\ \\ =50\%$

Therefore, the market share of the largest firm is 50%.

7 0

2 years ago