What are some characteristics of short term investments?

Answers

Answer 1

Good short-term investments may share many characteristics, but they are typically distinguished by the three following characteristics:

Stability:

Unlike many stocks and bonds, good short-term investments do not fluctuate in value significantly. The funds will be available when you need them and are frequently protected by FDIC insurance or a government guarantee.

Liquidity:

A good short-term investment usually has high liquidity, which means you can get your money back quickly. You'll know when the money becomes available in the case of certain CDs, and you can always redeem the CD, though it will often come with a penalty unless you choose a no-penalty CD.

Low transaction costs:

Unlike, say, buying a house, a good short-term investment doesn't cost much to get into or out of. This is crucial in situations where short-term investment yields are poor.

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Related Questions

Valuing cash flows with infinite growth in the dividend discount models (DDMs): a. cannot be calculated because growth to infinity is immeasurable b. may only be calculated if growth is 3.0% or less c. may not be calculated using any DDM unless growth is less than the discount rate d. will include the value of dividends received far in the future even though they may have PVs close to zero

Answers

Option C is correct. Valuing cash flows with infinite growth in the dividend discount models (DDMs may not be calculated using any DDM unless growth is less than the discount rate.

How do you value cash flows?

In order to carry out the value of cash what a person has to do would be to get the present value of the cash in the flow and then add them up.

Hence the answer to the question that we have here is option C. Valuing cash flows with infinite growth in the dividend discount models (DDMs may not be calculated using any DDM unless growth is less than the discount rate.

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Nate works as a sales representative. His employment contract specifies that he cannot work for a competitor for a period of two years from employment. This is an example of Group of answer choices vagueness. extortion. ambiguity.

Answers

Nate works as a sales representative. His employment contract specifies that he cannot work for a competitor for a period of two years from employment. This is an example of ambiguity.

What is ambiguity in employment contract?

Ambiguity is used to explain a condition that is not permanent in a Job but that remain relevant within the period given.

It is to the disadvantage of the employer because if they term is bridged it may affect the business or company through leaking of vital company information.

Therefore,

Nate works as a sales representative. His employment contract specifies that he cannot work for a competitor for a period of two years from employment. This is an example of ambiguity

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The amount by which actual or expected sales exceeds break-even sales is referred to as.

Answers

The amount by which actual or expected sales exceed break-even sales is referred to as more accurate product costing.

A break-even analysis is what, exactly?

Break-even analysis involves figuring out and looking at an entity's margin of safety based on the revenues received and related costs. The study, in other words, demonstrates how many sales are necessary to cover operating expenses.

The break-even analysis establishes the number of sales required to cover all fixed costs for the organization by analyzing various pricing levels in relation to various levels of demand. A demand-side study would provide a seller with important information about their selling capacities.

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The Hamlet Company uses the periodic inventory system. Information for the current year is as follows:Sales $ 2,650,000Beginning inventory 680,000Purchases 1,200,000Purchase returns 12,000Ending inventory 740,000Hamlet's cost of goods sold for the current year is:

Answers

$1128000.

Net purchases=Purchases-Purchases returns

=(1,200,000-12000)=$1188000

Cost of goods sold=Beginning inventory+Net purchases-Ending inventory

=680,000+1188000-740,000

=$1128000.

A periodic inventory system is a form of inventory valuation where the inventory account is updated at the end of an accounting period rather than after every sale and purchase. The method allows a business to track its beginning inventory and ending inventory within an accounting period.

A perpetual inventory system inventory updates purchase and sales records constantly, particularly impacting Merchandise Inventory and the Cost of Goods Sold. A periodic inventory system only records updates to inventory and costs of sales at scheduled times throughout the year, not constantly.

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If sellers expect the price of their product to rise in the future, they are likely to _____ in the near term. increase their demand restrict their demand increase their supply restrict their supply

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If sellers expect the price of their product to rise in the future, they are likely to lower the price in the near term. increase their demand restrict their demand increase their supply restrict their supply.

A seller is a person or entity that sells products, services, or financial assets. Shorting means borrowing a security you don't own, selling it, and buying it back at a lower price. The option seller is known as the "writer" who collects a premium from the buyer.

Buyers or sellers being "balanced" refers to the imbalance of orders in the market at any given time. The term also describes a trader whose activity over a period of time tends to be predominantly in the direction of buying or selling, with a tendency to balance the two.

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In 2013, how much money did Tesla raise via common stock offerings, net of fees and expenses?a) $515.6 millionb) $410.1 millionc) $420.2 milliond) $355.0 million

Answers

Tesla was able to raise via $410.1 million from common stock offerings, net of fees and expenses to finance the business.

What was the finance for?

As part of shareholder's capital, the fund was used by the firm to finance the vehicle innovations.

Hence, the firm called "Tesla" was able to raise via $410.1 million from common stock offerings, net of fees and expenses to finance the business.

Therefore, the Option B is correct.

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John Smith works 40 hours for ABC Corp. for $15 per hour. Required payroll deductions are: Social Security $37.20, Medicare $8.70, federal Income tax $58, and state income tax $10. What is John's net pay

Answers

Answer: 486.10

Explanation: 600-37.20-8.70-58-10=486.10

Fannie Mae and Freddie Mac are responsible for creating most of the commonly-used residential appraisal report forms.

Answers

Fannie Mae and Freddie Mac are responsible for creating most of the commonly-used residential appraisal report forms: TRUE

Who are Fannie Mae and Freddie Mac?Congress established Fannie Mae and Freddie Mac. They play a vital role in the nation's home finance system, supplying the mortgage market with liquidity, stability, and affordability. They provide liquidity (quick access to cash on acceptable conditions) to thousands of banks, savings and loans, and mortgage businesses that make home loans.Fannie Mae and Freddie Mac can also help stabilize mortgage markets and protect housing during times of extreme stress or volatility in the broader financial system. The Enterprises' assistance with mortgage loans to finance affordable housing lowers the cost of such borrowing.The majority of the regularly used home appraisal report types were developed by Fannie Mae and Freddie Mac.

As the description itself says, the majority of the regularly used home appraisal report types were developed by Fannie Mae and Freddie Mac.

Therefore the statement "Fannie Mae and Freddie Mac are responsible for creating most of the commonly-used residential appraisal report forms" is TRUE.

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Complete question:

Fannie Mae and Freddie Mac are responsible for creating most of the commonly-used residential appraisal report forms. True or False

merchant lytes clerks whom johnny met at the merchants business assumed that johnny was there as one of Miss Lavinias suitors. true or false

Answers

The Statement is True.

The clerks at Merchant Lyte's office think Johnny is there for to court Miss Lavinia.

The following Paragraph Supports the Statement.

When Johnny arrives at Mr. Lyte’s the servants tease him because they think he is there to propose to Lavinia. When he finally meets Mr. Lyte, the rich merchant cruelly laughs at Johnny, insults his mother, and tries to send him away. However, Johnny carefully describes the cup that his mother left him to prove that he is related to the Lytes. Mr. Lyte and his servant, Sewall, both recognize the cup from Johnny’s description. Mr. Lyte tells Johnny he can come back at suppertime and that he should bring the cup.

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• In Chapter 10, read the "Reading EnergyGuide Labels" section and complete
the following questions:
1. What types of products have an energy-efficiency rating (EER)?
2. Why might a consumer want to know the estimated yearly energy costs
for operating an appliance?

Answers

The types of products have an energy-efficiency rating (EER) are:

Air conditionersHome Energy MonitorsSmart ThermostatsEV Charging Stations
What is an energy-efficiency rating (EER)?

The EER is the cooling capacity (in British thermal units (Btu) per hour) divided by the power input (in watts).

Why might a consumer want to know the estimated yearly energy costs for operating an appliance?

Without energy monitoring, the customer will be unable to identify inefficiencies in their company or home and efficiently correct the issue.

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Answer:

1Air conditioners, heat pumps, furnaces, and boilers

2 Having the estimated cost allows a consumer to make intelligent cost comparisons over time with different models of a product.

Explanation:

trust me

Assuming that there is one-half pound of resin per foot of the finished product, determine the resin materials cost per foot of finished product for June. $0.53 $0.60 $0.54 None of these choices are correct

Answers

The resin materials cost per foot of finished product for June $0.53.

Given the data in the question;

                                                      May                  June                          July

Resin pounds input

into the process                       470,000            700,000              650,000

Price per pound                         X$1.50               X$1.50                    X$1.50

Plastic material costs             $493,000           $640,000             $677,000

Conversion costs                    $80,000           $120,000                 $115,000

Conduit output from

the process (feet)                   800,000              1,200,000            1,130,000

Assuming that there is one-half pound of resin per foot of the finished product, determine the resin materials cost per foot of finished product for June.

Given:

Materials cost for June = $640,000

Number of Feet produced as output in June =  1,200,000

   

So, Formula of Material Cost per foot of finished product

Material Cost per foot of finished product = Material Cost/ Number of feet produced in June

                                                                        = $640,000 / 1,200,000

                                                                        = $0.5333 = $0.53

Therefore, the resin materials cost per foot of finished product for June is $0.53

Hence, the correct option is A.

Your question is incomplete, but most probably your full question was:

Rambo-Conduit Corporation manufactures plastic conduit that is used in the cable industry. A conduit is a tube that encircles and protects the underground cable. In the process of making the plastic conduit, called extrusion, the melted plastic (resin) is pressed through a die to form a tube. Scrap is produced in this process. Information from the cost of production reports for three months is as follows, assuming that inventory remains constant:

May June July

Resin pounds input into the process 470,000 700000 650,000

Price per pound x81.50 x81.50 x81.50

Plastic material costs 493,000 6,40,000 6,77,000

Conversion costs 80,000 120,000 115000

Conduit output 800,000 1200,000 1130,000

from the process (feet)

Assuming that there is one-half pound of resin per foot of the finished product, determine the resin materials cost per foot of finished product for June.

a. $0.53

b. $0.60

c. $0.54

d. None of these choices are correct.

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When preferred stock is cumulative and the directors either do not declare a dividend to preferred stockholders or declare one that does not cover the total amount of the cumulative dividend, the unpaid dividend amount is called:

Answers

The unpaid dividend amount is known as dividend in arrears.

What is preferred stock?

Preferred stock entitles its holders to receipt of dividends before common stockholders and after the bondholders have received their interest payments.

What is cumulative preferred stock?

This has a  edge over the ordinary preferred stocks since its holders are entitled to receive arrears of dividends, dividends not declared in a particular year or the shortfall in dividends, which means in future years they would receive that year's dividends plus any unpaid dividends in earlier years.

The amount of preferred dividends that could not be paid in a particular year because there is no  cash available or that dividends were not declared are known as dividends in arrears.

Overall, the correct answer with which to fill the space in the case is dividends in arrears.

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The concept that under the right circumstances, groups are smarter than the smartest individuals in them is referred to as ________.

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The concept that under the right circumstances, a group is smarter than the smarter individuals in them is referred to as the wisdom of crowds.

Wisdom of crowds is a principle that assumes that the knowledge of crowd outcomes in higher decision-making, innovation, and problem-fixing than that of a person. A crowd needs to be large, and diverse, and people within the crowd cannot be prompted by others for the principle to work.

The mathematical concept plays an important role in the Wisdom of crowds, The crowd's squared error equals the average person squared errors minus the variety of the predictions. this can be referred to as the diversity prediction theorem. This occurs now not the handiest in this example; it is actually in each example. it's far a mathematical identity, like the Pythagorean theorem.

There is diversity inside the group and their wondering is unbiased of what others have to say. The idiosyncratic errors canceling each other out is not a gain of 'understanding of crowds'. because the opinion of a huge group of people could be very numerous of their thinking and it is their unbiased opinion.

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If the grievance committee concludes potentially unethical conduct may have occurred:.

Answers

When the Grievance Committee suspects possibly unethical behavior, they hold an investigation to see if the Code's provisions have been broken. A code of ethics outlines the moral principles and best practices that an organization should adhere to in order to be honest, ethical, and professional. If an organization's members violate the code of ethics, there may be consequences, including firing.

The grievance committee main responsibility is to examine complaints that haven't been settled at the staff or administrative levels and, if necessary, to mediate disputes. Examples of this type of grievance include discipline, unethical conduct, categorization conflicts, benefit denial, and so on.

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Multiple Choice Question The changes in the non-cash balance sheet accounts explain the differences between the ______. Multiple choice question. net income and total stockholders' equity income statement and the statement of cash flows net income and total assets income statement and the statement of retained earnings

Answers

Answer: income statement and the statement of cash flows

Explanation:

A monopolistic competitor wishing to maximize profit will select a quantity where.

Answers

The primary objective of a monopolistically competitive firm is to maximize profits by increasing revenues and minimizing the total costs of production. The profit maximizing level of output occurs where marginal revenue is equal to the marginal cost of production.

What is Profit Maximization?

Monopolistic competition is a market structure characterized by many firms selling differentiated products with some barriers to entry into the market.

The primary objective of a monopolistically competitive firm is to maximize profits by increasing revenues and minimizing the total costs of production. The profit maximizing level of output occurs where marginal revenue is equal to the marginal cost of production.

In Other Term, Profit maximization is a process business firms undergo to ensure the best output and price levels are achieved in order to maximize its returns.

Therefore, we can conclude that the correct option is A.

Your question is incomplete, but most probably your full question was:

A monopolistic competitor wishing to maximize profit will select a quantity where:

a) Marginal revenue equals marginal cost

b) Marginal cost equals demand

c) Marginal cost equals average cost

d) Marginal revenue equals average cost

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n macroeconomics, the short run assumes that input prices are ______ while output prices are ______.

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N macroeconomics, the short run assumes that input prices are inflexible while output prices are flexible.

Macroeconomics is the branch of economics that studies the performance, structure, behavior, and decision-making of the economy as a whole. For example, interest rates, taxes, and government spending are used to regulate economic growth and stability. This includes regional, national, and global economies.

Macroeconomics is the branch of economics concerned with the economy as a whole or its structure, performance, behavior and decision-making. His two main areas of macroeconomic research are long-term economic growth and short-term business cycles.

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In a limited liability partnership, each partner's risk of losing personal assets is Multiple Choice limited to losses that result from his/her own acts and omissions and the acts and omissions of those who work under his/her supervision. unlimited. determined entirely by the maximum loss provision established by the articles of co-partnership. nonexistent.

Answers

In a limited liability partnership, each partner's risk of losing personal assets is determined entirely by the maximum loss provision established by the articles of co-partnership

What is  limited liability partnership?

This involves business partnership with individual that pursue the same goal and objectives.

The debt or owing is limited an not allow to spread beyond the financial commitment by the partners.

Therefore,

In a limited liability partnership, each partner's risk of losing personal assets is determined entirely by the maximum loss provision established by the articles of co-partnership.

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Select ALL that apply. Which three statements accurately describe the effects of the economic policies on individuals

Answers

The three statements that describe the effects of those economic polices on individuals are:

Many African Americans had a difficult time getting Jobs because of all-white policies.Many farmers were bankrupt due to the overproduction.Many immigrants took low paying jobs, which led to a decrease in pay for all employees.

What happened as a result of economic policies in the 1920s?

The 1920s saw a continuation of Jim Crow laws which limited African American employment. More people also came into the nation as immigrants which led to lower pay as immigrants could be convinced to take lower paying jobs.

Farmers began to produce more than the market wanted and this, coupled with import tariffs on American goods, led to bankrupcy.

Options for this question include:

Many African Americans had a difficult time getting Jobs because of all-white policies.White men working in the car industries went bankrupt due to overextension of bank loans.Many farmers were bankrupt due to the overproduction.White men working in assembly lines were laid off due to new technological improvements.Many immigrants took low paying jobs, which led to a decrease in pay for all employees.

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What non-price determinant is causing the curve to shift? choose the specific letter in the correct acronym

Answers

The  non-price determinant of the number of sellers in the market is causing the curve to shift

Demand curve shifts occur when demand determinants other than price change. It occurs when the demand for goods and services changes, even if the price does not change.

To understand this, we first need to understand what the demand curve does. Record the demand plan. This is a detailed chart showing the number of units purchased at each price. It follows the law of demand that people buy fewer units as prices go up. Unless nothing else changes, a business principle is called ceteris paribus. This means that all demand determinants other than price must remain the same.

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Create a project justification for Global Treps Running Case. Prepare a business case for the Global Treps project. Assume that the project will take six months to complete, use many volunteer hours, and cost about $130,000 for hardware, software, travel, and labor. Use the business case template provided on the Companion website for this text. Be sure to research information on the television show and events held by colleges and other groups, which have been sparked by the need for more successful entrepreneurs. Also visit DonorsChoose.org to see how that site operates and look into steps for forming a non profit organization.

Answers

It should be noted that a business case gives justification for undertaking a project or portfolio.

What is a business case?

It should be noted that business case evaluates the benefit, the cost and risk of alternative options and gives a rationale for the preferred solution.

When writing a business case, it's important to always define the scope and include an executive summary, detailed information about finances, as well as.an overview of the project's structure.

Every member of the project team should contribute to the business case and the business case should be concise and only include relevant information

In conclusion, the business case provides decision makers, stakeholders and public for evidence based and transparent decision making.

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Complete question:

You and your team are continuing your work on the Global Treps Project. Your project sponsor, Dr. K. has asked you to refine the existing cost estimate for the project so you can evaluate supplier bids and have a solid cost baseline for evaluating project performance. Recall that your schedule and cost goals are to complete the project in six months for under $120,000. You planned to use up to $50,000 total to pay yourself and your team members, and your initial estimates were $30,000 for travel expenses, $20,000 for hardware and software, and $20,000 for organizing four events, including consultants, legal/business fees, etc.

A machine has a cost of $15,000, an estimated residual value of $3,000, and an estimated useful life of four years. The machine is being depreciated on a straight-line basis. At the end of the second year, what amount will be reported for accumulated depreciation?.

Answers

The amount in accumulated depreciation at the end of the second year: $6,000.

What is Depreciation?

Long-term assets are used up gradually over their lives and this use needs to be expensed under the matching principle in the GAAP (Generally Accepted Accounting Principles). The way this is done is by using a method of depreciation to approximate the expense.

Formula :

Accumulated Depreciation = [tex]\frac{ Cost of Assets - Salvage/ Residual Value}{Life of the asset}[/tex] × [tex]No. of Year[/tex]

Given:

Asset Cost = $15,000

Residual Value = $3,000

No. Of Year= 2

SOLUTION-

We find the amount in accumulated depreciation by finding the depreciable value:

Depreciable Value = Asset Cost - Residual Value

Depreciable Value = $15,000 - $3,000

Depreciable Value = $12,000      

Now, let's divide this by 2 to find the amount in accumulated depreciation at the end of the second year:

Accumulated Depreciation =$12,000 / 2 = $6,000

Hence,  The amount in accumulated depreciation at the end of the second year is $6,000.

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Which problem is Arthur experiencing in the given example?
Arthur has been working for a company for three months. However, the company’s values are conflicting with his own. Since he does not fit in the organization’s culture, Arthur has started experiencing { blank }, which is manifesting as frustration and anger.

Answers

Answer:

Demotivation

Explanation:

Since Arthur has been working for 3 months and he is in a company where he is aware not knowing much about it, he is beginning to feel a lack of interest and passion about his work.

The problem that Arthur is experiencing in the given example is a cultural mismatch or cultural conflict with the organization. Since Arthur has been working for 3 months and he is in a company where he is aware not knowing much about it, he is beginning to feel a lack of interest and passion about his work.

When a person's personal values, beliefs, and behaviors diverge from the standards and conventions of the workplace or society, there is a cultural mismatch.

Arthur feels frustrated and enraged as a result of this cultural struggle. These unfavorable feelings most likely result from the discrepancy between his personal principles and the values upheld by the business. Feelings of being misunderstood, undervalued, or unable to fully contribute at work might result from this imbalance.

Therefore, it would be advantageous for Arthur to look into opportunities to address the cultural mismatch, such as finding common ground with coworkers, asking for support from supervisors, or pondering whether a different workplace might be a better fit for his personal goals.

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What is the fee schedule for these services, assuming that the goal is to cover only variable and direct fixed costs?

Answers

A schedule of fees is a list of costs associated with carrying out specific administrative tasks. The fee schedule is subject to modification at the commissioner's discretion and is to be made available on the website of the state land office.

The amount of product generated determines the fluctuation in variable costs. Raw materials, labor, and commissions are examples of variable expenses. Regardless of the level of production, fixed expenses stay constant. Lease and rental payments, insurance, and interest payments are examples of fixed costs.

Costs that change as the volume increases are known as variable costs. Raw materials, piece-rate labor, production supplies, commissions, shipping expenses, packing costs, and credit card fees are a few examples of variable costs.

Rent, lease payments, salary, insurance, property taxes, interest fees, depreciation, and possibly certain utilities are just a few examples of fixed costs. For instance, a new business owner would probably incur fixed costs at first for rent.

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Signing and dating a delivery receipt for a life insurance policy helps to establish all of the following timeframes EXCEPT

Answers

Signing and dating a delivery receipt for a life insurance policy helps to establish all of the following timeframes EXCEPT the grace period.

What is insurance?

This refers to a process whereby a company(insurance company) provides an assurance of compensation to another(insured) incase of loss or illness in return for payment called premium.

Some of the benefits of insurance are:

Mitigation of riskProvision of insurance service by the insurance companyProtection from unexpected loss

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How might a company innovate in order to assist a customer with the execute step of a job, according to bettencourt and ulwick?

Answers

According to Bettencourt and Ulwick, We are all aware that people "hire" goods and services to complete tasks. Scalpels are used by surgeons to cut up soft tissue. To clean the filth off their hands, janitors hire paper towels and soap dispensers.

Deconstructing the task the customer is trying to do from start to finish can provide you a clear picture of all the areas where they could want extra assistance from a product or service, which is essential if you want to innovate.

Companies can examine the greatest shortcomings of the goods and services customers now use and find chances for improvement by using an approach called job mapping.

It entails breaking down the goal the client wants to achieve into the eight fundamental job steps.

It is well knowledge that individuals "rent" commodities and services to carry out tasks. Surgeons tear up soft tissue with scalpels.

Janitors use paper towels and soap dispensers to wash the grime off their hands. If you want to innovate, it's crucial to break down the process the consumer is attempting to do from beginning to end in order to get a clear image of all the areas where they could need extra help from a good or service.

Using a method known as job mapping, businesses can assess the biggest flaws in the products and services that customers now use and identify opportunities for improvement.

It requires dissecting the client's desired outcome into the following eight key task steps.

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Steve Matthews, CFA, is a principal at Carlson Brothers, a leading regional investment bank specializing in initial public offerings of small to mid-sized biotech firms. Just before many of the IPOs are offered to the general public, Matthews arranges for 10% of the shares to be distributed to management of the firm going public. This action is a violation of the Standard concerning:

Answers

Steve Matthews, CFA, is a principal at Carlson Brothers, a leading regional investment bank specializing in initial public offerings of small to mid-sized biotech firms. This action is a violation of the Standard concerning fair dealing.  This is further explained below.

What is fair dealing. ?

Generally, "Dealing" with" copyrighted works without permission is a copyright user's privilege known as "fair dealing."

In conclusion, Carlson Brothers, a major regional investment bank specializing in initial public offerings of small to midsize biotech companies, has Steve Matthews, a CFA, as a partner. According to the Fair Dealing Standard, this is a breach of the law.

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Usury laws, established by each state, provide for the protection of:_______
a. sellers.
b. lenders.
c. borrowers.
d. licensed real estate brokers and salespersons.

Answers

Usury laws, established by each state, provide for the protection of borrowers.

What are usury laws?

This is the term that is used to refer to the laws that are made in the United States that are known to protect the interest of the borrowers against the lender who make impose very high interest rates on the amount of money that a person may borrow.

The laws are known to be ancient in nature and were said to have originated from the English colonies which adopted them from the British people.

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Once the break-even point is reached, the sale of an additional unit increases contribution margin by an amount that is ______ the increase in net operating income.

Answers

Once the break-even point is reached, Once the break-even point is reached, the sale of an additional unit increases contribution margin by an amount that is equal to the increase in net operating income.

What is break even?

This refers to a point in which neither profit nor loss is attained by a business.

It is where there is no profit or loss is incurred by a firm hence you have to make just as much as what you are spending.

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A young couple is attempting to purchase their first home, but they do not have adequate funds for a down payment at this time. They should investigate the possibility of a lease-purchase, which would enable them to move in right away, but go to settlement at a later date. The lease-purchase contract should include all of the following EXCEPT

Answers

The lease-purchase contract should include all of the following EXCEPT all financing terms for the purchase.

What is Lease Purchase Contract?

A Lease-Purchase Contract, also known as a Lease Purchase Agreement. A lease purchase agreement in real estate is a rent-to-own contract between a tenant and a landlord for the former to purchase the property at a later point in time. The renter pays the seller an option fee at an agreed-upon purchase price, giving them exclusive rights to buy the property.

Both parties agree to what the purchase price of the home will be at the end of the lease term. The agreement will likely include a stipulation that a portion of the monthly rent goes toward a down payment. The renter should be confident that they can secure a mortgage at the end of the lease, or else they forfeit the purchase option.

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