Answer:
C. $4000
Explanation:
Given that
Total opportunity cost = salary plus interest forgone, that is 50,000 + 6% of 100,000
= 50,000 + 6000 = 56,000.
Total revenue received = 60,000
Recall that
Economic profits = Revenue - (implicit + explicit cost)
And that
Implicit cost = opportunity cost = 56,000
Explicit cost = 0 (from the question, revenue covered it)
Thus
Economic profit = 60000 - 56000
= $4000
Answer:
Explanation:
Net Cost of Life Insurance Premium : Life insurance policy entails Premium to be paid by the insured at a monthly / quarterly interval. insured often gets dividend from the insurance company and in that case, the net cost of premium will be low
The 20 years premium can be calculated with Annual Premium which is not given in the question, therefore i will solve for all the option but please pick the answer that the Annual premium is with you
a) 20 years premium = Annual Premium x Number of years
= 11700 x 20
= 234,000
b) 20 years premium = Annual Premium x Number of years
= 7900 x 20
= 158,000
c) 20 years premium = Annual Premium x Number of years
= 550 x 20
= 11,000
d) 20 years premium = Annual Premium x Number of years
= 28350 x 20
= 567,000
Complete Question:
James Stilton is the chief executive officer (CEO) of RightLiving, Inc., a company that buys life insurance policies at a discount from terminally ill persons and sells the policies to investors. RightLiving pays the terminally ill patients a percentage of the future death benefit (usually 65%) and then sells the policies to investors for 85% of the value of the future benefit. The patients receive the cash to use for medical and other expenses, and the investors are "guaranteed" a positive return on their investment. The difference between the purchase and sale prices is RightLiving's profit.
Stilton is aware that some sick patients may obtain insurance policies through fraud (by not revealing their illness on the insurance application). An insurance company that discovers such fraud will cancel the policy and refuse to pay. Stilton believes that most of the policies he has purchased are legitimate, but he knows that some are probably not.
Requirement:
What are other ethical concerns that Stilton may be facing?
Answer with Explanation:
The ethical concerns of Stilton are as under:
- Should he tell the investors about the fraud about the policies before making sales?
- What policies must be implemented so that the legitimate people can easily sell the policies and if not implemented it would not be fair for the RightLiving, Inc.
- Stilton will also be facing ethical concerns because the business wishes that the customer dies early so that they can benefit from increased deaths of policy holders.
Answer:
Making sure that your view points are clearly heard.
Explanation:
Effective communication can be defined as the process of passing out information in a clear and concise manner. It is a means of successfully conveying information to the listener.
Effective communication helps to improve productivity among employees in an organisation. This type of communication can be enhanced by a good body language.
In the scenario described above, an effective communication can be achieved by ensuring that your viewpoints are clearly understood by the audience.
Sell the asset, which will drive down the price and cause the expected return to reach the level of the required return.
