Scott knows that he will ultimately face retirement. Assume that Scott will experience two periods in his life, one in which he works and earns income, and one in which he is retired and earns no income. Scott can earn $250,000 during his working period and nothing in his retirement period. He must both save and consume in his work period with an interest rate of 10 percent on savings. Refer to scenario. If the interest rate on savings increases, a. Scott will always increase his savings in the work period. b. Scott will increase his savings in the work period if the income effect is greater than the substitution effect for him. c. Scott will decrease his savings in the work period if the income effect is greater than the substitution effect for him. d. Scott will decrease his savings in the work period if the substitution effect is greater than the income effect for him.

Navel county choppers, inc., is experiencing rapid growth. the company expects dividends to grow at 19 percent per year for the next 8 years before leveling off at 5 percent into perpetuity. the required return on the company’s stock is 10 percent. if the dividend per share just paid was $1.52, what is the stock price?

Suppose that xtel currently is selling at $40 per share. you buy 500 shares using $15,000 of your own money, borrowing the remainder of the purchase price from your broker. the rate on the margin loan is 8%. a. what is the percentage increase in the net worth of your brokerage account if the price of xtel immediately changes to (a) $44; (b) $40; (c) $36? (leave no cells blank - be certain to enter "0" wherever required. negative values should be indicated by a minus sign. round your answers to 2 decimal places.) b. if the maintenance margin is 25%, how low can xtel’s price fall before you get a margin call? (round your answer to 2 decimal places.) c. how would your answer to requirement 2 would change if you had financed the initial purchase with only $10,000 of your own money? (round your answer to 2 decimal places.) d. what is the rate of return on your margined position (assuming again that you invest $15,000 of your own money) if xtel is selling after one year at (a) $44; (b) $40; (c) $36? (negative values should be indicated by a minus sign. round your answers to 2 decimal places.) e. continue to assume that a year has passed. how low can xtel’s price fall before you get a margin call? (round your answer to 2 decimal places.)

You speak to a business owner that is taking in almost $2000 in revenue each month. the owner still says that they are having trouble keeping the doors open. how can that be possible? use the terms of revenue, expenses and profit/loss in your answer