Question

Question 41 An unrealized gain or loss on a security is a result of: Not yet answered Marked out of 1.00 Select one: a. the difference between the selling price of the security and its historical cost Flag question b. the difference between the purchase price of the security and its selling price c. the difference between the book value of the security and its market value O d. the difference between the purchase price of the security and its current fair market value Question 42 An annuity pays $1500 at the beginning of every month for five years. The interest rate of the annuity is 4%. What is this annuity's future value? Not yet answered Marked out of 1.00 Select one: O a. 97948 P Flag question b.99780 C. 99448 O d. 101280 Question 43 In which of the following situations would a shareholder prefer to receive stock dividends as opposed to cash dividends? Not yet answered Marked out of 1.00 Select one: O a. The investor is looking to own shares in the company for a long period of time. Flag question b. The investor wants a regular stream of income from his investment. c. All of these answers. d. Cash dividends and stock sales are both taxed using capital gain rates.

Answer 1

41. Unrealized gain or loss occurs due to increase or decrease in the FMV of the asset. Answer:d 42. r=4%/12 = 0.04/12 = 0.0033 n = 5 X 12 = 60 FV = L x ((1 +r)"-1) X (1+r)| = 1500 X ((1+0.0033)50-1) X (1+0.0033) 0.0033 = 99780 Answer: b 43. Stock dividend will ensure further investment in the company. So if someone is already planning to invest then he may prefer stock dividend. Since cash dividend is taxable, stock dividend may be desirable. Getting stock dividend means more investment in the company which will increase the return from investment. Answer: c 44. Asset - Equity = Debt Thus (Asset-Equity)/Debt = Debt/Debt where equity is missing Answer: b As per policy, I can solve first four question. Please give likes for the hard work. Thanks