Answer:
A. (a, the area between the diagonal line and the lorenz curve divided by the total area below the diagonal line)
B. (a, a perfectly unequal income distribution will have a Gini ration of 1.)
C. (a, more equal)
Explanation:
A. Gini ratio can be defined as the statistical determination of the wealth and income distribution among a country's populace.
It can also be called Gini coefficient or Gini index, and it is a measure of the inequality in income and wealth distribution.
The Gini ration is calculated by finding the difference between the Lorenz curve and the uniform distribution line, then divided by the total area under the uniform distribution line. A Gini ration of <0.2 is the perfect income equality.
B. Gini ratio cannot exceed 1 because a perfectly unequal income distribution will have a Gini ratio of 1. This means that the line of equality does not move irrespective of whether or not the Lorenz curve changes.
C. If the Gini ratio declines from 0.42 to 0.35, then that means that income has become more equal. Note that a Gini ratio of <0.2 signifies a perfect income distribution, slightly greater than 0.2 to ).35 signifies that income distribution is close to equality.
Cheers.
Answer:
$21.37
Explanation:
g = -5.4%
D0 = $3.93
D1 = D0 (1+g)
D1 = 3.93*(1-0.054)
D1 = 3.93*0.946
D1 = 3.71778
Investors require a return (ke) of 12%
P0 = D1/(ke - g)
P0 = 3.71778 / (12% - (-5.4%)
P0 = 3.71778 / (12% + 5.4%)
P0 = 3.71778 / 17.4%
P0 = 3.71778 / 0.174
P0 = 21.3665517
P0 = $21.37
So, the expected price of the stock next year is $21.37.
Answer:
Cash flow from assets = $51,800
Explanation:
Cash flow from assets = Cash flow to Creditors + Cash flow to Shareholders
Cash flow to creditors = Interest Paid – (New loans taken – Paid Loans)
= $28,311 - ($0 - $21,000)
= $28,311 + $21,000
= $49,311
Cash flow to shareholders = Dividends paid – Net new equity
= $27,500 – $25,000
= $2,500
Cash flow from assets = $49,311 + $2,500 = $51,811
Answer:
C
Explanation: I think its C cause it just makes sense lol
Answer:
Longard Corp.
The money that Longard Corp. receives is:
= $75 million.
Explanation:
a) Data and Calculations:
Number of shares issued = 5 million
Investment bank underwriter pays per share to Longard Corp = $15
Stock price to the public = $20 per share
Total amount received from the underwriter = $75 million ($15 * 5 million)
b) The calculations show that the investment bank will eventually receive $100 million ($20 * 5 million) from the public offer. It then charges $5 per share (representing a total underwriting fee of $25 million). This is why it remits only $75 million to Longard Corp.