Problem on National income
Providing reasons, describe the treatment assigned to the following which estimates national income.(i) Family members working freely on farm owned by family.(ii) The Payment of interest on borrowings through general government.
Expert
(i) Imputed salaries of such members will be comprised in national income.
(ii) This will not be comprised in national income since it is non-factor payment as the general government borrows just for consumption purpose.
Suppose a firm's common stock paid a dividend of $1.75 yesterday. You expect the dividend to grow at the rate of 8% per year for the next 3 years, if you buy the stock, you plan to hold it for 3 years and then sell it. Q : What is the equivalent rate A bank A bank quotes an interest rate of 13.5% per annum with quarterly compounding. What is the equivalent rate with (a) continuous compounding and (b) annual compounding?
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