Future events that cannot be controlled by the decision maker are called
a. indicators
b. states of nature
c. prior probabilities
d. posterior probabilities
B
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Which of the following is the BEST advice for using template documents that are available with word processing software?
a. Avoid their use altogether; they are worthless. b. Recognize their shortcomings, and use them cautiously. c. Use the deductive templates, but ignore the inductive and persuasive ones. d. Use them with confidence, as they were developed by experts.
Indicate how each event affects the elements of financial statements. Use the following letters to record your answer in the box shown below each element. You do not need to enter amounts. Increase = I Decrease = D No Effect = NA (Note that "No Effect" means that the event does not effect that element of the financial statements or that the event causes an increase in that element is offset by a decrease in that same element.)An adjusting entry recorded as a debit to Depreciation Expense and a credit to Accumulated Depreciation.AssetsLiabilitiesStk. EquityRevenuesExpensesNet IncomeStmt of Cash Flows???????
What will be an ideal response?
R.I.P. Company manufactures herbicide and pesticide. The company had difficulty finding affordable liability insurance. R.I.P. established its own insurance company based in Bermuda for the purpose of insuring R.I.P.'s loss exposures
The company that R.I.P. formed is called a A) captive insurer. B) reciprocal insurer. C) fraternal insurer. D) holding company.
NorthWest Water (NWW)
Five years ago, issued $50,000,000 face value of 30-year bonds carrying a 14% (annual payment) coupon. NWW is now considering refunding these bonds. It has been amortizing $3 million of flotation costs on these bonds over their 30-year life. The company could sell a new issue of 25-year bonds at an annual interest rate of 11.67% in today's market. A call premium of 14% would be required to retire the old bonds, and flotation costs on the new issue would amount to $3 million. NWW's marginal tax rate is 40%. The new bonds would be issued when the old bonds are called. Refer to the data for . The amortization of flotation costs reduces taxes and thus provides an annual cash flow. What will the net increase or decrease in the annual flotation cost tax savings be if refunding takes place? A. $6,480 B. $7,200 C. $8,000 D. $8,800 E. $9,680