Which of the following best describes why the predicted incremental earnings arising from a given decision are not sufficient in and of themselves to determine whether that decision is worthwhile?

a) they do not show how the firm's earnings are expected to change as the result of a particular decision.
b) they are not easily predicted from historical financial statements of a firm and its competitors.
c) these earnings are not actual cash flows.
d) they do not tell how the decision affects the firm's reported profits from an accounting perspective.

Torino company has 1,300 shares of $50 par value, 6.0% cumulative and nonparticipating preferred stock and 13,000 shares of $10 par value common stock outstanding. the company paid total cash dividends of $3,500 in its first year of operation. the cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders is:

Afinancial institution, the thriftem bank, is in the process of formulating its loan policy for the next quarter. a total of $12 million is allocated for that purpose. being a full-service facility, the bank is obligated to grant loans to different clientele. the following table provides the types of loans, the interest rate charged by the bank, and the possibility of bad debt as estimated from past experience.type of loaninterest rateprobability of bad debtpersonal.140.10car.130.07home.120.03farm.125.05commercial.100.02 bad debts are assumed unrecoverable and hence produce no interest revenue either. competition with other financial institutions in the area requires that the bank allocate at least 40% of the total funds to farm and commercial loans. to assist the housing industry in the region, home loans must equal at least 50% of the personal, car, and home loans. the bank also has a stated policy specifying that the overall ratio for bad debts on all loans may not exceed .04. formulate this problem as a linear program. define your variables clearly and write all the constraints explaining the significance of each.

Suppose that real interest rates increase across europe. this development will u.s. net capital outflow at all u.s. real interest rates. this causes the loanable funds to because net capital outflow is a component of that curve.