Response: Per the Internal Revenue Service (IRS), all retirement assets, including those in SDIRAs, must be held by a qualified custodian. The custodian—which could be a bank, credit union, or other financial institution—administers the SDIRA, holds the account’s investments for safekeeping, and ensures that the SDIRA complies with IRS rules.While you can open an IRA or SDIRA at virtually any bank or financial institution, most “big box” custodians don’t offer alternative investments, such as real estate, precious metals, or cryptocurrencies. Therefore, it’s essential to find an SDIRA custodian that offers the nontraditional assets in which you are interested. Keep in mind that these firms can’t provide investment advice, meaning investment research is your responsibility.


What Are the Key Characteristics of Alternative Investments?

Response: Alternative investments tend to have high fees and minimum investment requirements, compared to retail-oriented mutual funds and ETFs. They also tend to have lower transaction costs, and it can be harder to get verifiable financial data for these assets. Alternative investments also tend to be less liquid than conventional securities, meaning that it may be difficult to value some of the more unique assets because they are so thinly traded.


Response: Gross profit is the difference between net revenue and the cost of goods sold. Total revenue is income from all sales while considering customer returns and discounts. Cost of goods sold is the allocation of expenses required to produce the good or service for sale.


Response: C2C stands for customer-to-customer; P2P stands for peer-to-peer. Both concepts involve consumers or individuals dealing with one another. The main difference is that with C2C, there is a company or other third party in between the buyer and the seller (or sender and receiver). In a P2P platform, counterparties transact directly with one another without that intermediary.


Response: The hazard rate seeks to determine the chances of survival of its subject at a certain time point. It can effectively be applied to any item with a set lifetime and is commonly used in engineering, medicine, and insurance.


Response: You can join a REIG or start your own. Professional networking groups and websites, such as LinkedIn or the National Real Estate Investors Association, are good starting points. Joining a group may be as simple as signing an agreement and paying dues.


Response: You can cash a money order in the same places that issue money orders, such as a bank, credit union, post office, check-cashing store, or even some convenience and grocery stores. You will need to endorse, or sign, the order and verify your identity. There may be a small fee for cashing the money order, which you can skip by depositing the money order into a bank account.


Can a Disregarded Entity Have Employees?

Response: Yes, a disregarded entity can have employees. The "disregarded entity" status is recognized only for the purposes of federal income taxes; it doesn't affect employment—and in fact, a disregarded entity with workers might have to pay employment taxes. However, the IRS and courts have ruled that a single-member LLC, one of the most common types of disregarded entities, cannot classify an owner as both an employee and a partner.


What Happens If I Do Not Pay Property Taxes?

Response: Property taxes are sanctioned by municipal government bodies and are legal obligations for owning real estate. If you do not pay your property taxes, the government has the right to seize your property, claim rights over proceeds to cover the owed obligations and dispose of a property to a new owner. The rules around this tax deed process vary between government entities.


What Guarantee Does a Policyholder Have With a Warehouse-to-Warehouse Clause?

Response: A policyholder of a warehouse-to-warehouse clause has a guarantee that the goods will arrive and arrive undamaged at the intended destination, or the cost of the lost or damaged goods will be covered.


What Happens If a Buy Limit Order Is Not Executed?

Response: If a buy limit order is not executed, it will expire unfilled. The order could expire at the end of the trading day or, in the case of a good 'til canceled (GTC) order, it will expire once the trader cancels it. One of the benefits of a buy limit order is that the investor is guaranteed to pay a specified price or less to purchase a security. A downside, however, is that the investor is not guaranteed that their order will be executed.


What Are the Advantages and Disadvantages of a CD?

Response: Some savers like CDs because of the safety they provide, as well as the fact that they are perfectly predictable. On the other hand, CDs generally promise a very modest rate of return, compared to riskier investments like stocks and bonds. If the interest rate offered is below the current inflation rate, then investors in CDs will actually lose money on their investment when it’s measured on an inflation-adjusted basis. For this reason, yield-conscious investors might prefer investments that are riskier but offer higher potential returns.


Which Countries Have Currencies That Are Pegged to the USD?

Response: Fourteen countries have currencies pegged to the USD and include Bahrain, Belize, Cuba, Djibouti, Hong Kong SAR, China, Jordan, Lebanon, Oman, Panama, Qatar, Saudi Arabia, United Arab Emirates, and Eritrea.


What Is the Difference Between Monopolistic Competition and a Monopoly?

Response: A monopoly is when a single company dominates an industry and can set prices for its product without fear of competition. Monopolies limit consumer choices and control production quantity and quality. Monopolistic competitive companies must compete with others, restricting their ability to substantially raise prices without affecting demand and providing a range of product choices for consumers. Monopolistic competition is more common than monopolies, which are discouraged in free-market nations.


How Do I Use API Integration for Automated Stock Screening?

Response: API integration in stock screeners allows users to connect with external data sources and automate certain tasks. By leveraging APIs, investors can set predefined rules, receive real-time updates, and automate actions such as trade executions or alert notifications.


Response: You can create an account or bid on eBay as a guest. The easiest way for you to make your bids is through the automated process. This allows you to enter the total amount you're willing to pay for an item. The site then bids for you in increments without going over your maximum limit. If another individual outbids you, eBay will let you know. You can decide whether you want to place a new maximum limit.


What Risks Are Associated with Overfunded Pension Plans?

Response: Overfunded pension plans can face risks, particularly in terms of investments. One risk is the temptation to pursue riskier investments to maximize returns on surplus funds as there may be less of an impact for losses.


How many contingent beneficiaries can be named?

Response: You can name as many contingent beneficiaries as you’d like and portion out your estate in any ratio that you wish. You can also appoint an organization as a beneficiary instead of an individual.


How Does Porter's Five-Force Model Apply to the AI Sector?

Response: Using the model, we would begin by looking at the competitive rivalry. The AI sector is marked by high competition with key players ranging from tech giants to small startups. Rapid advances mean companies have to move quickly simply to maintain relevance. We would then need to gauge the power of suppliers of data sets and specialized hardware, which have ample power since AI firms rely heavily on these resources.Moving to consumers, we would need to review the needs of individual consumers and whether larger companies can force AI firms to negotiate better services and prices for them. The field of AI has been attracting many new entrants, but there are significant barriers to entry, including high initial research and development costs. Lastly, the threat from the last force, the possibility of substitutes, depends on what a firm wants to do with its AI-based technology. The more complicated the tasks the AI is given, the more likely other goods and services can't substitute for it.


Response: Aggregate demand can be impacted by a few key economic factors. Rising or falling interest rates will affect decisions made by consumers and businesses. Rising household wealth increases aggregate demand while a decline usually leads to lower aggregate demand. Consumers' expectations of future inflation will also have a positive correlation with aggregate demand. Finally, a decrease (or increase) in the value of the domestic currency will make foreign goods costlier (or cheaper) while goods manufactured in the domestic country will become cheaper (or costlier) leading to an increase (or decrease) in aggregate demand.


Response: All qualified entities that deal in the futures markets need to register with the NFA. These include a variety of entities, such as brokers, futures merchants, commodity pool operators, swap dealers, exchanges, and commodity trading advisors.


What Is the Objective of an Amalgamation?

Response: In general, the objective of an amalgamation is to establish a unique entity capable of more effectively competing in the marketplace, while also benefiting from greater economies of scale. In that respect it is not all that different from an acquisition and similar strategies to aid corporate growth.


What Are the Most Commonly Used Probability Distributions?

Response: The most commonly used probability distributions are uniform, binomial, Bernoulli, normal, Poisson, and exponential.


Is it Good to Have all Your Money in One Bank?

Response: It can be safe to have all of your money in one bank, but this is not without risk. If your account balances at one bank exceed $250,000 (or $500,000 for a joint account), then that excess amount won't be covered by FDIC deposit insurance in the event of a bank failure. In this scenario, you would be better off keeping some of your funds in a different financial institution.


Response: In real estate, a short sale may take place when an owner sells a house at a price that is less than the outstanding mortgage amount.This typically happens when the owner is under financial stress and is behind on mortgage payments. The owner is obligated to sell the home to a third party, with all of the proceeds of the sale going to the lender.The lender must approve the short sale before it happens. The process can take as long as a year due to the paperwork involved.


Response: Historical returns are the past performance of a security or index, such as the S&P 500. Analysts review historical return data when trying to predict future returns or to estimate how a security might react to a particular economic situation, such as a drop in consumer spending. Historical returns can also be useful when estimating where future points of data may fall in terms of standard deviations.


Response: Cash-on-cash returns are calculated using an investment property's pre-tax cash inflows received by the investor and the pre-tax outflows paid by the investor. Essentially, it divides the net cash flow by the total cash invested.For example, an investor purchases a property for $1 million putting $100,000 cash as a down payment and borrowing $900,000. The investor also pays $10,000 cash for ancillary costs out of pocket. The investor decides to sell the property for $1.1 million after having paid $25,000 in loan payments that include a principal repayment of $5,000.This means the investor's total cash outflow is $135,000 [$100,000+$10,000+$25000] and cash inflow is $205,000 [$1,100,000 - $895,000]. So, the investor's cash-on-cash return is 51.85% [($205,000 - $135,000) ÷ $135,000].


Response: Present value is important because it allows investors to judge whether or not the price they pay for an investment is appropriate. Calculating present value (and future value) can help investors when they are presented with the choice of earning a fixed sum for the investment at some point in the future, or gaining a percentage of the principal.Present value calculations are often needed in areas such as investment analysis, risk management, and business financial planning, but the concept is also useful outside of business. For example, understanding the present and future values of an annuity can help you when predicting your retirement income.


Response: Renters insurance is not usually mandatory by law, but some landlords may require it as a condition of the lease agreement. Even if it's not required, having renters insurance is highly recommended to protect your belongings and liability.


What Is Marginal Propensity To Consume in Simple Terms?

Response: The marginal propensity to consume measures the degree to which a consumer will spend or save in relation to an aggregate raise in pay. Or, to put it another way, if a person gets a boost in income, what percentage of this new income will they spend? Often, higher incomes express lower levels of marginal propensity to consume because consumption needs are satisfied, which allows for higher savings. By contrast, lower-income levels experience a higher marginal propensity to consume since a higher percentage of income may be directed to daily living expenses.


What Is Enterprise Value and Why Is It Important?

Response: Enterprise value shows a company's total value and is generally used in mergers and acquisitions to evaluate a prospect. You might also see embedded value used to value life insurance companies, primarily in Europe.


Response: The harmonic mean is best used for fractions such as rates or multiples. Harmonic means are used in finance to average data like price multiples such as the price-to-earnings (P/E) ratio. Market technicians may also use harmonic means to identify patterns such as Fibonacci sequences.


When Capital Expenditures Increase, What Happens to Cash Flow?

Response: Generally, cash flow is reduced, as the cash has been used to invest in future operations, thus promoting future growth of the company.


What Is the Purpose of Management Discussion and Analysis?

Response: The purpose of management discussion and analysis is to shed more light on how the financial statements were prepared, how the company performed, and what the company expects for the future. It's management's opportunity to explain in their own words about the financial position and strategy of the company. It's purpose is usually not only to reassure investors of its financial health but to convey its financial strategy to promote confidence.


How Do I Know If My Mortgage Is Assumable?

Response: Certain types of home loans are assumable. For example, USDA, VA, and FHA loans are assumable. Each agency has specific requirements that both parties must fulfill for the loan to be assumed by the buyer. The USDA requires that the house is in a USDA-approved area, the seller must not be delinquent on payments, and the buyer must meet certain income and credit limits. The buyer must confirm with the seller and the seller's lender if the loan is assumable.


How Is a Widow's Allowance Different from a Widow’s Pension?

Response: Whereas a widow's allowance, widower's allowance, or spousal allowance is time-limited, a widow’s pension is a recurring survivor's benefit that a surviving spouse may be entitled to receive as a beneficiary of a pension plan, retirement account, Social Security or a VA survivors pension. The criteria for qualifying for these benefits will vary, and will usually be spelled out in the written documentation and policies dictated in the program terms and guidelines. Likewise, the formula for determining the amount of these allowance payments will also be dictated by the program.


Response: Proof-of-Stake is a consensus mechanism where cryptocurrency validators share the task of validating transactions. There are currently no certificates issued.


Can the Hurdle Rate Vary Within a Company?

Response: Yes, the hurdle rate can vary within a company based on the risk profile and the nature of different departments or projects. High-risk projects, such as those involving new product development or expanding into new markets, might have a higher hurdle rate than lower-risk endeavors like routine capital maintenance. Varying the hurdle rate helps ensure that the rate of return keeps up with changes in the level of risk associated with each project.


What Do Buyers in a Merger or Acquisition Look for?

Response: The buying company in a merger or acquisition commonly looks for growth and value in the selling company along with opportunities for business model transformation, technological capabilities, and new talent resources.


How Do Liabilities Relate to Assets and Equity?

Response: The accounting equation states that—assets = liabilities + equity. As a result, we can re-arrange the formula to read liabilities = assets - equity. Thus, the value of a firm's total liabilities will equal the difference between the values of total assets and shareholders' equity. If a firm takes on more liabilities without accumulating additional assets, it must result in a reduction in the value of the firm's equity position.


Response: The string of characters at the bottom left of a check identifies the bank branch that it is issued from, the account number of the payer, and the number of the account holder's check in a consecutive series.From left, the line displays the following information:The nine-character routing number that identifies the bank branchThe 12-character account number that identifies the payerThe four-character check number that indicates which check in a series that the account holder has used.It looks like this: 000000000 000000000000 0000


What Factors Influence an Individual's Investment Objective?

Response: In addition to an individual’s time horizon and risk profile, other factors that influence an individual’s investment decisions include income, capital gains tax, dividends tax, commission and fees for actively managed portfolios, and total wealth, which may include assets like Social Security benefits, expected inheritance, and pension value.


Response: A pip is like a tick, representing the smallest change to the right of the decimal, but often applies to forex markets. It is the smallest whole unit price move that an exchange rate can make.


Response: The risk/return ratio helps investors assess whether a potential investment is worth making. A lower ratio means that the potential reward is greater than the potential risk, while a high ratio means the opposite. By understanding the risk/return ratio, investors can make more informed decisions about their investments and manage their risk more effectively.


Can I Lose Hollywood Dollars on a Trade?

Response: Yes. If the value of a MovieStock or StarBond you own, goes down and you sell it, you will have lost money. However, the really risky way to lose is where you sold or shorted a MovieStock or StarBond because you thought the value was going to go down. As the bond or stock goes up in value, your paper loss will increase until you liquidate that trade or the bond or stock expires. So, if you sorted a MovieStock at H$10 and it eventually closes out at H$100, you will have lost H$90.


Response: If you are subpoenaed to sit for a deposition, you must show up by law and answer the questions honestly and to the best of your knowledge. Failure to show up could result in imprisonment for contempt of court and forced into a deposition there. Lying under oath can result in the crime of perjury.


How Much Did the Stock Market Crash During the Great Recession?

Response: On October 9, 2007, the Dow Jones Industrial Average closed at its pre-recession high of 14,164.53. By March 5, 2009, the index had fallen more than 50% to 6,594.44.On September 29, 2008. The Dow Jones fell nearly 778 points in one day. It was the largest point drop in history until the market crashed in March 2020 at the start of the COVID-19 pandemic.


Which Country Has No Currency of Its Own?

Response: There are a number of different countries that don't have their own currency. For instance, 19 member states of the European Union use the euro as their currency. Some countries use the U.S. dollar exclusively for transactions, including Zimbabwe, Ecuador, El Salvador, East Timor, and the Turks and Caicos islands among others.


Response: A tax-sheltered annuity is a type of retirement plan offered by certain organizations, such as churches, non-profit organizations, and public schools. This plan works like other retirement plans—employees can contribute a certain portion of their annual salaries up to a certain amount each year. These contributions are made on a pre-tax basis. Earnings grow tax-free, which means they aren't taxed until the plan owner begins making withdrawals during retirement.


Why Do Companies Engage in Earnings Management?

Response: There are many reasons corporate managers engage in earnings management. These include higher bonuses, avoidance of falling below closely followed analyst forecasts, tax savings, boosting the value of the company, and creating a sense of stability.


Response: Each state specifies its own usury rate and how it is calculated. For example, the current usury rate in North Dakota is the "maximum rate of interest which may be charged for loans of money by non-regulated lenders and is equal to 5.5% higher than the current cost of money as reflected by the average rate of interest payable on U.S. Treasury Bills maturing within six months; but in any event, the maximum allowable interest rate ceiling may not be less than 7%."


What Is the Difference Between the U.S. Treasury and the Federal Reserve?

Response: The U.S. Treasury and the Federal Reserve are separate entities. The Treasury manages the money coming into and out of the government. The Federal Reserve's primary responsibility is to keep the economy stable by managing the supply of money in circulation. The Department of the Treasury manages federal spending. It collects the government's tax revenues, distributes its budget, issues its bonds, bills, and notes, and prints money. The Federal Reserve is the central banking system of the United States and is run by a board of governors that oversees 12 regional Federal Reserve Banks.


Response: Futures contracts are a type of derivative. They involve a standardized contract to buy or sell a certain security at a specific price and at a specified time in the future. Futures are used by investors to hedge the value of securities they have positions in and to speculate on price movements.


Response: The roll-down return is the percentage change in the bond price over the period plus the coupon payments divided by the initial bond price. The calculation assumes the yield curve remains constant, there are no significant changes in the issuer's credit risk, and yields evolve as anticipated.


What Is the Abbreviation for Modus Operandi?

Response: Modus operandi is sometimes abbreviated as M.O. Therefore, one's M.O. refers to their usual patterns of behaviors or habits.


Response: Project finance is a way for companies to fund long-term projects. This form of financing uses a non- or limited recourse financial structure. Firms with weak balance sheets are more apt to use project finance to meet their funding needs rather than trying to raise capital on their own. This is especially true for smaller companies and startups that have large-scale projects on the horizon.


How Do I Know If a Company Has a Competitive Advantage?

Response: If a business can increase its market share through increased efficiency or productivity, it would have a competitive advantage over its competitors.


What Are the Main Distribution Channels?

Response: Distribution channels are the intermediaries through which goods or services pass on their way to the final buyer or consumer. The main channels include wholesalers, retailers, distributors, and in some cases, the internet.


How Is Fair Value Considered In the Accounting of Financial Assets?

Response: Generally Accepted Accounting Principles and International Financial Reporting Standards use fair value in accounts comprised of derivatives and hedges, employee stock options, and financial assets and accept that financial markets are efficient and their prevailing prices are reliable measures of fair value.


Response: EBITA is considered by some to be a reliable indicator of how efficient a company’s operations are. Some analysts use it to gauge profitability, although doing so can be misleading because of the excluded expenses.


Response: APY standardizes the rate of return. It does this by stating the real percentage of growth that will be earned in compound interest assuming that the money is deposited for one year. The formula for calculating APY is (1+r/n)n - 1, where r = period rate and n = number of compounding periods.


What Is the Situational Leadership Model by Hersey and Blanchard?

Response: Situational leadership is adapting your style based on who you manage and assign tasks to and the situation.


How Is an Excise Tax Different From a Sales Tax?

Response: Excise and sales taxes are two different types of taxes. An excise tax is imposed on specific goods and is generally the responsibility of the merchant to pay to the government. The merchant, in turn, may or may not pass the tax on to the consumer by adding it into the price. A sales tax, on the other hand, is charged on almost everything and is collected from the consumer by the merchant who passes it on to the government. The sales tax is a percentage of the price of the good or service.


What Is the Difference Between Adjustable Life Insurance and Universal Life Insurance?

Response: Adjustable life insurance is another name for universal life insurance. There is no difference between them, as they are the same type of policy.


Response: IBES is available through various subscription services offered by Thomson Reuters, including its Refinitiv, Thomson ONE, and Eikon platforms.


What Is an Example of Inventory Management?

Response: Let's look at an example of a just-in-time (JIT) inventory system. With this method, a company receives goods as close as possible to when they are actually needed. So, if a car manufacturer needs to install airbags into a car, it receives airbags as those cars come onto the assembly line instead of having a stock on supply at all times.


How Long Will the Child Tax Credit Be Higher?

Response: The higher Child Tax Credit that was enacted during the pandemic has since expired. The Child Tax Credit dropped from $3,000 / $3,600 per child (depending on age) back to $2,000 per eligible child at the end of 2021.


Response: What happens when you default on a loan depends on the type of loan and the lender's policy. In the case of a secured loan, the lender can seize the asset you used as collateral. For a consumer with an auto loan, that is usually the vehicle. For a business, the collateral might be a piece of equipment, real estate, or a cash account. With an unsecured debt, such as a credit card or personal loan, the lender can sue the borrower or turn the debt over to a collection agency.


What Are the Chances of Being Audited by the IRS?

Response: The audit rate for individual tax returns was 0.49% in 2022. The IRS has audited the returns of 8.5% of the people making $10 million or more between 2012 and 2020. Individuals may be randomly selected and others triggered by departures from the norm, such as a charitable deduction that exceeds the filer's reported income.


Response: Book value is the historical cost of an asset less the accumulated depreciation booked for that asset to date. This amount is carried on a company's financial statement under noncurrent assets. On the other hand, salvage value is an appraised estimate used to factor how much depreciation to calculate. It's a guess on how much the company can get for the asset at the end of its life, and this value, though helpful to determine components of a financial statement, isn't actually reported on a company's financial statement.


Response: Total economic surplus is equal to the producer surplus plus the consumer surplus. It describes the total net benefit to society from free markets in goods or services.


What Role Did Deregulation Play in the Bear Stearns’ Collapse?

Response: Some economists have attributed the subprime mortgage crisis to financial deregulation, particularly the 1999 repeal of parts of the Glass-Steagall Act. This repeal removed the legal barriers between commercial and investment banking, allowing banks like Bear Stearns to issue and underwrite securities. These securities would ultimately become a major catalyst for the financial collapse.


Response: Stockholders' equity is equal to a firm's total assets minus its total liabilities. These figures can all be found on a company's balance sheet.


What Is the USDA Office of Rural Development?

Response: The USDA Office of Rural Development includes three agencies that provide economic assistance to rural families and communities—a housing program, a utilities program, and a business program. The housing program provides guaranteed and direct home loans to help low- and moderate-income borrowers in rural areas purchase modest homes with no down payment.


What Is the Maintenance Margin Requirement by a Brokerage Firm?

Response: The maintenance margin is the minimum equity an investor must hold in the margin account after the purchase has been made. The customer's equity in the account must not fall below 25% of the current market value of the securities in the account. If this requirement is not met, the brokerage firm may liquidate the securities in the customer's account.


Response: A receivable is created any time money is owed to a firm for services rendered or products provided that have not yet been paid. This can be from a sale to a customer on store credit, or a subscription or installment payment that is due after goods or services have been received.


Response: Initial public offerings (IPOs) are usually underwritten by investment banks. These banks usually have IPO specialists on staff who work with the company making the IPO to ensure that all regulatory requirements are met.


Response: For 2024, the IRS standard deduction is $14,600 for single taxpayers. This is an increase from $13,850 in 2023. For married couples filing jointly, the deduction is $29,200, which is an increase from $27,700 in 2023.


How Long Does Information Remain on Your Credit Report?

Response: Information on your credit report will typically remain for at least seven years, after which it basically falls off. One exception is Chapter 7 bankruptcy, which can remain for up to 10 years.


What Are the Stages of the Product Life Cycle?

Response: The product life cycle is defined as four distinct stages: product introduction, growth, maturity, and decline. The amount of time spent in each stage will vary from product to product, and different companies have different strategic approaches to transitioning from one phase to the next.


Response: APIC is recorded under the equity section of a company's balance sheet. It is recorded as a credit under shareholders' equity and refers to the money an investor pays above the par value price of a stock. The total cash generated from APIC is classified as a debit to the asset section of the balance sheet, with the corresponding credits for APIC and regular paid in capital located in the equity section.


What Are the Decision Rules for Accounting Rate of Return?

Response: When a company is presented with the option of multiple projects to invest in, the decision rule states that a company should accept the project with the highest accounting rate of return as long as the return is at least equal to the cost of capital.


Response: Many institutions, including the European Commission, argue that they should. They argue that the shadow banking sector requires regulation because of its size, its close links to the regulated financial sector, and the systemic risks that it poses. There is also a need, they claim, to prevent the shadow banking system from being used for regulatory arbitrage, or the process of taking advantage of loopholes to avoid potential regulatory restrictions.


What makes a capital project successful?

Response: Careful planning and realistic estimates do. Affordable funding needs to be secured, costs need to be managed well, and the project must have a very good chance of becoming profitable. One or two setbacks could turn a capital project into a financial disaster.


What Are the 2 Types of Demand Schedules?

Response: Demand schedules may be prepared for individual consumers or for the broad, general market. These two demand schedules will differ as the market demand schedule will encompass a more broad set of expectations while an individual demand schedule may be more refined into a specific subset of data.


Response: To get a pension, an employee has to work for a company that offers a pension plan. This can be a private company, though a majority of pension plans are now offered by government institutions and agencies. In addition, people must often meet a vesting requirement by working for a company for a specific amount of time to quality for pension plan benefits.


What Information Must Be Recorded in a Business Journal?

Response: Every entry in a business journal must contain all critical information about a transaction. In double-entry accounting, this means the date of the transaction, the amount to be credited and debited, a brief description of the transaction, and the business accounts that are affected by it.Depending on the business, the journal may make room for other entries, such as the tax implications or the impact on a subsidiary.


Response: Ethereum's transaction fees continue to fluctuate, but they haven't changed much since proof of stake rolled out—the update was not intended to change fees.


Response: If a couple divorces, they become tenants in common, which gives them both ownership rights in the property. A court can also order the sale of the property—the proceeds would be split between the ex-spouses—or grant full ownership to one spouse.


How Do Liquidated Damages Differ From a Penalty Clause?

Response: A liquidated damages clause is designed to allow a party to a contract to recover a loss. A penalty clause is punitive. It is intended as punishment.


Response: Taxpayers must comply with IRS code; any deviation from tax law may result in fines or imprisonment. Some may feel that these tax avoidance strategies are unethical. However, taxpayers are often encouraged to deploy legal strategies that may include avoiding or deferring taxes. Because these strategies have been embedded in intentional tax law, tax shelters are ethical and not necessarily meant to be devious.


Response: Yes. Short interest as a percentage of float above 20% is considered high, and it indicates a very pessimistic sentiment.


Response: An overvalued stock is one whose stock price is not in line with its earnings outlook, such as its price-to-earnings (P/E) ratio. Analysts that believe a stock is overvalued expect that its price will fall.


Response: No, you don't have to file Form 1098 or submit it with your tax return. You only have to indicate the amount of interest reported by the form. And you generally only report this interest if you are itemizing deductions on your tax return.


Response: A TSP is not exactly the same thing as a 401(k), though they are structured similarly and have the same contribution limits. A TSP is what the federal government offers instead of a 401(k), the type of plan offered by private employers. It is possible to have both if you have worked for both a government and a private employer. However, the total contribution to these retirement plans cannot exceed the annual contribution limits set by the Internal Revenue Code.


Response: Owning land is important because it is a source of wealth. Land can be harvested and the materials grown on it sold for profit. Factories, warehouses, and buildings that will facilitate business can be built on land. Land can be leased in return for income. Land is also a tangible good that does not depreciate. In addition, land cannot easily be tampered with, in that there is nothing to steal from it (for the most part). It can be polluted and/or destroyed, but that can be prevented to a degree.


How Does Privatization Affect Economic Efficiency?

Response: Many economists believe that privatization can make some government-owned enterprises more efficient by placing them under budget pressure and market discipline. This requires the administrators of those companies to reduce their inefficiencies by downsizing unproductive departments or reducing costs.


Response: Variance is essentially the degree of spread in a data set about the mean value of that data. It shows the amount of variation that exists among the data points. Visually, the larger the variance, the "fatter" a probability distribution will be. In finance, if something like an investment has a greater variance, it may be interpreted as more risky or volatile.


What Is an Example of the Law of Supply and Demand?

Response: When gasoline consumption plunged with the onset of the COVID-19 pandemic in 2020, prices quickly followed suit because the industry ran out of storage space. The price decline, in turn, served as a powerful signal to suppliers to curb gasoline production. Conversely, crude oil prices in 2022 provided producers with additional incentive to boost output.


Response: A double negative pledge is a promise not to enter into negative covenants with any third party. In other words, it is a negative covenant that prohibits other negative covenants. This type of agreement is frequently used by banks or other lenders to ensure that they have a priority claim to a borrower's assets if they declare bankruptcy.


What Time Is the Opening Bell on Wall Street?

Response: The New York Stock Exchange rings the opening bell at 9:30 AM every day, except weekends and holidays. The Nasdaq opens at the same time, but as an automated market the bell is purely ceremonial.


Response: There are 365 businesses in the bank industry in the UK as of 2023. This is an increase of 3.5% from 2022.


Response: A debit note is sent by the vendor or supplier to the buyer. The document is intended to inform the customer of their debt obligations relating to a purchase order. Debit notes may also be issued by buyers as a way to let the vendor know that goods received are being returned.


Response: Retainer fees can be calculated by estimating the hours needed to complete or maintain the project the professional is hired for and multiplying it by their hourly rate. Some professionals might charge an amount per expected service.


Response: In 2010, the International Organization for Standardization (ISO) released ISO 26000, a set of voluntary standards to help companies implement corporate social responsibility. Unlike other ISO standards, ISO 26000 provides guidance rather than requirements because the nature of CSR is more qualitative than quantitative, and its standards cannot be certified. ISO 26000 clarifies social responsibility and helps organizations translate CSR principles into practical actions.


What Are the Benefits of the Empirical Rule?

Response: The empirical rule is beneficial because it serves as a means of forecasting data. This is especially true when it comes to large datasets and those where variables are unknown. In finance specifically, the empirical rule is germane to stock prices, price indices, and log values of forex rates, which all tend to fall across a bell curve or normal distribution.


What Are the Lowest and Highest Ranked Numbers in Liar's Poker?

Response: In Liar's Poker, 0s are usually the lowest-ranked numbers, while 9s are the highest-ranked numbers.


Response: Three examples of quality control could be in the food industry; overseeing the ingredient specifications, reviewing supplier lists, and ensuring the facility where the food product is made is sanitary.


How Do Fixed Costs Differ From Variable Costs?

Response: Unlike fixed costs, variable costs are directly related to the cost of production of goods or services. Variable costs are commonly designated as the cost of goods sold (COGS), whereas fixed costs are not usually included in COGS. Fluctuations in sales and production levels can affect variable costs if factors such as sales commissions are included in per-unit production costs. Meanwhile, fixed costs must still be paid even if production slows significantly.


What Are the Most Popular Cryptocurrencies?

Response: Bitcoin is the most popular cryptocurrency, followed by other cryptocurrencies such as Ethereum, Binance Coin, Solana, and Cardano.


What Does It Mean to Become an Expatriate?

Response: An expatriate or "expat" is somebody who leaves their country of origin and settles abroad for an extended period of time, often permanently.


Response: Taxable income is calculated by adding up all sources of income, excluding nontaxable items, and subtracting credits and deductions.


Response: How an individual can determine whether they have a tax lien against their property depends on where they live and which agency imposed that lien. In most places, a search via the state record office or the attorney general's office will reveal the existence of a lien against property. The Automated Lien System of the IRS can locate liens against businesses. There are private, third-party lien searching services that can also do lien research.


Response: Financial hardship for many, persistent poverty, and a dispirited populace that could be ripe for social and political unrest are just a few of the effects of income inequality.


Response: SPACs have a specific time frame in which they need to merge with another company and close a deal. This time frame is usually 18 to 24 months. If a SPAC cannot merge during the allotted time, then it liquidates and all funds are returned to investors.


How Can I Insure My Electronic Documents?

Response: Electronic documents can be insured through a separate endorsement, called a data loss policy. These policies cover traditional sources of damage, such as fire or flooding, as well as hacking, viruses, and hard drive crashes. However, such policies typically do not cover wear and tear, or losses due to improper file storage.


Which Companies Have Been Accused of Predatory Pricing?

Response: Walmart is among the companies that have been accused of predatory pricing. In 1993, a judge ordered the retailer to stop selling drugs and health and beauty products below cost after three stores in Conway, Arkansas, accused the company of undercutting them to drive them out of business.This wasn’t an isolated case. Similar allegations were leveled at Walmart from rival companies in other states, and the company has been accused of predatory pricing on several other occasions.


Response: A central bank is a financial institution given privileged control over the production and distribution of money and credit for a nation or a group of nations. In modern economies, the central bank is usually responsible for the formulation of monetary policy and the regulation of member banks. Central banks are inherently non-market-based or even anti-competitive institutions. Although some are nationalized, many central banks are not government agencies, and so are often touted as being politically independent. However, even if a central bank is not legally owned by the government, its privileges are established and protected by law. The critical feature of a central bank—distinguishing it from other banks—is its legal monopoly status, which gives it the privilege to issue banknotes and cash. Private commercial banks are only permitted to issue demand liabilities, such as checking deposits.


Response: No specific amount is correct for everyone, and FSA elections vary depending on each indidvidual's particular situation. Make your election by carefully examining your expected out-of-pocket healthcare expenses for the coming year.


Response: In general, dividends are paid in cash. Dividend payments can also be reinvested in the stock distributing them to buy more shares.


Response: You can improve your creditworthiness by ensuring that your credit reports are correct, reducing your debt by paying more than the minimum balance, and by paying all your bills on time. Avoid applying for too many credit cards and loans and using all of your available credit.


Response: HERA was passed by Congress as part of a joint effort to support recovery in the mortgage industry and restore confidence in both Fannie Mae and Freddie Mac. HERA was signed into law by then-President George W. Bush.


Response: The median is the middle value in a set of data. First, organize and order the data from smallest to largest. To find the midpoint value, divide the number of observations by two. If there is an odd number of observations, round that number up, and the value in that position is the median. If the number of observations is even, take the average of the values found above and below that position.


Response: A life estate is a legal document that splits ownership of property, so that the first party retains rights to use the property and the second party retains rights to inherit it.


Response: Yes, Nasdaq uses a similar process when the market closes at 4 p.m. This is called the Closing Cross and is used to determine the closing price of shares.


Do an SPV's Assets and Liabilities Appear on the Parent Company's Balance Sheet?

Response: No. Special purpose vehicles have their own obligations, assets, and liabilities outside the parent company. SPVs can, for example, issue bonds to raise additional capital at more favorable borrowing rates than the parent could. They also create a benefit by achieving off-balance sheet treatment for tax and financial reporting purposes for a parent company.


Response: The IRS allows certain net losses experienced in one tax period to be used to deduct from net profits earned in subsequent periods. The 2018 Tax Cuts and Jobs Act (TCJA) changed how businesses must account for net operating loss carryforwards. Check with your accountant for all tax matters


Response: There are two components to Q4 2022. The first part ("Q4") represents the quarter, while the second part ("2022") represents the year. In this example, the phrase Q4 2022 means the fourth quarter in 2022.Because this phrase includes both the quarter and the year, this phrase assumes that whatever is being analyzed has a fiscal year that is the same as a calendar year.


Are Unilateral Contract Mistakes Enforceable?

Response: If a mistake occurs during a unilateral contract, some remedies for a mistake include contract reform where the contract is changed or a new contract is started, or full contract cancellation.


Response: Cash earned illegally from selling drugs may be laundered through highly cash-intensive businesses such as a laundromat or restaurant where the illegal cash is mingled with business cash before deposit. These types of businesses are often referred to as “fronts.”


Response: Yes, ETPs are traded on stock exchanges. This means that investors can buy and sell ETP shares throughout the trading day at market prices. The stock exchange environment enhances liquidity and provides real-time pricing information for ETPs.


Response: By market capitalization, the largest stock exchanges are the New York Stock Exchange and the Nasdaq. Both are located in the New York. As of March 2022, the combined value of shares listed on both exchanges reached over $36 trillion.


Response: If you are over age 73 and choose not to take your RMD, you will be penalized by the IRS. The amount not withdrawn will be subject to a 25% tax. Before the SECURE 2.0 Act was passed in 2022, this was a 50% penalty. According to the IRS, the penalty drops to 10% if the "RMD is timely corrected within two years."


Is Work-in-Progress a Form of Inventory?

Response: A piece of inventory becomes labeled as work-in-progress when raw material combines with human labor. When the product is finalized, it switches from WIP to being categorized as a finished product. Finally, when the product is sold, it moves from a form of inventor to cost of goods sold (COGS) on the balance sheet.


What Is the Risk Premium for an Investment?

Response: The risk premium is the extra amount you're expected to get for taking on risk. It is the percentage return you get over what you’d receive if you made an investment with zero risk. So, for example, if the S&P has a risk premium of 5%, it means you should expect to get 5% more from investing in this index than from investing in, say, a guaranteed certificate of deposit.


Has Insider Trading a Negative Connotation?

Response: The term "insider trading" generally has a negative connotation based on the perception that it is unfair to the average investor. Essentially, insider trading involves trading in a public company's stock by someone with non-public, material information about that stock. Insider trading is illegal, but if an insider trades their holdings and reports it properly, it is an insider transaction, which is legal.


Response: The four T's of risk management are:Tolerate: management decides they are okay with a certain operational risk and does not action to stop it.Terminate: management is not okay with any level of risk with a certain activity and decides to stop that activity.Treat: management puts in place certain maneuvers that decrease the potential total risk.Transfer: management wants to perform an activity but seeks a third-party to incur the risk on their behalf (i.e. buy insurance).


How Is the Sharing Economy More Environmentally Sustainable?

Response: The sharing economy is often cited as environmentally beneficial because it allows existing resources to be used more efficiently. An Uber driver sells rides to many people who otherwise would have to buy vehicles. A co-working space provides all of the equipment and space needed for a large number of home offices.


Is Email Money Transfer Available for Businesses?

Response: Interac offers email money transfer services for businesses, which have options like bulk processing services, bulk receivables, and bulk payables, as well as invoicing capabilities for business customers.


What Is the Most Accurate Moving Average?

Response: The accuracy of a moving average depends greatly on the length of the period being tracked. The most commonly used moving average periods are 50-day, 100-day, and 200-day moving averages. Historically speaking, the longer the term, the more accurate the indicator. This is because the impact of market day-to-day "noise" diminishes over time—and it takes time for a trend to clarify.


Response: Joint tenancy may lead to problems between parties if or when the personal relationship turns sour. It can also negatively impact one party if the other doesn't live up to their financial obligations. And it prevents owners from passing on their stake to someone of their choosing.


Response: Lenders will vary in their requirements for your maximum housing expenses ratio, but they generally want that ratio to be under 28% or 25%. Even if a lender approves you for a particular amount, that does not mean you can actually afford it. Carefully consider how a mortgage payment will fit into your budget.


Who Was Responsible for the Collapse of Enron?

Response: Several key executive team members are often noted as being responsible for the fall of Enron. The executives include Kenneth Lay (founder and former Chief Executive Officer), Jeffrey Skilling (former Chief Executive officer replacing Lay), and Andrew Fastow (former Chief Financial Officer).


What Is Included in Stockholders' Equity?

Response: Total equity effectively represents how much a company would have left over in assets if the company went out of business immediately


How Did Cap and Trade Work in California?

Response: California began operating a cap-and-trade program in 2013, and as of 2022, it is one of the largest emissions trading systems in the world. The ambitious program aimed to reduce greenhouse gas emissions to 1990 levels by 2020 (a goal that was met in 2016), and now aims to reduce the emissions by 40% below 1990 levels by 2030, and 80% below 1990 levels by 2050. California also has additional goals of achieving 100% carbon-free electricity by 2045 and economy-wide carbon neutrality by 2045.


Response: You can send it by visiting your bank and requesting a wire transfer or ACH transfer. Or, you can send it using a money transfer service that specializes in transfers, domestic and international. You can use an app such as PayPal to send a remittance to another country. These electronic services move money quickly, often within a day. If you prefer, you can always send a money order by U.S. mail but how soon it will arrive at its destination depends on which service you use (e.g., first-class international mail or Express mail).


Response: B-shares in China are shares of companies based in China that trade on the Shanghai Stock Exchange and the Shenzhen Stock Exchange. They are denominated in renminbi and on the Shanghai exchange they settle in USD and on the Shenzhen, they settle in HKD.


Response: As with all car insurance, your cost may vary based on your state, driving record, age, vehicle and other factors. Your insurer may be able to add gap insurance as an endorsement to your other coverage. Car dealerships may also offer gap insurance, though it may be more expensive than adding this coverage to your existing car insurance policy.


What Role Do Commercial Banks Play in the Economy?

Response: Commercial banks are crucial to the fractional reserve banking system, currently found in most developed countries. This allows banks to extend new loans of up to (typically) 90% of the deposits they have on hand, theoretically growing the economy by freeing capital for lending.


Response: Tax revenue includes revenues collected from taxes on income and profits, social security contributions, taxes levied on goods and services, payroll taxes, and taxes on the ownership and transfer of property. Total tax revenue is considered part of a country's GDP. As a percentage of GDP, total tax revenue indicates the share of a country's output that the government collects through taxes.


What are some drawbacks of issuing bonus shares?

Response: A company could potentially better utilize earnings set aside for a bonus issue to fund other activities that may generate a greater return on investment for shareholders. Additionally, bonus shares could reduce dividend payments, as they don’t generate cash for a company.


Response: Random variables produce probability distributions based on experimentation, observation, or some other data-generating process. Random variables, in this way, allow us to understand the world around us based on a sample of data, by knowing the likelihood that a specific value will occur in the real world or at some point in the future.


Response: Internal audit reports often outline the criteria, condition, cause, consequence, and corrective action. These five areas report why the audit was performed, what caused the reason for the audit, how the audit will be performed, what the auditor aims to achieve, and what steps will be taken after the audit findings are presented.


Response: A tax bracket defines a range of incomes subject to an income tax rate. Tax brackets are part of a progressive tax, in which the level of tax rates progressively increases as an individual’s income grows. Low incomes fall into tax brackets with lower tax rates, while higher earners fall into brackets with higher rates.


What Are the Advantages of EBITDA Margin?

Response: The EBITDA margin measures a company's operating profit as a percentage of its revenue, revealing how much operating cash is generated for each dollar of revenue earned. Therefore, a good EBITDA margin is a relatively high number in comparison with its peers. The simplicity of using one metric as a comparative benchmark can be helpful to investors.


Why Is Accounts Receivable Aging Important?

Response: There are two main reasons to track accounts receivable aging. First, to track overdue or delinquent accounts so that the company can continue to decide what to do with old debts. These may be sold to collections, pursued in court, or simply written off. The second reason is so that the company can calculate the number of accounts for which it does not expect to receive payment. Using the allowance method, the company uses these estimates to include expected losses in its financial statement.


What Are the Main Goals of Rational Choice Theory?

Response: The main goal of rational choice theory is to explain why individuals and larger groups make certain choices, based on specific costs and rewards. According to rational choice theory, individuals use their self-interests to make choices that will provide them with the greatest benefit. People weigh their options and make the choice they think will serve them best.


Response: Being aware of the presence of sampling errors is important because it can be an indicator of the level of confidence that can be placed in the results. Sampling error is also important in the context of a discussion about how much research results can vary.


What Is the Journal Entry for Accrued Expenses?

Response: Accrued expenses are recognized by debiting the appropriate expense account and crediting an accrued liability account. A second journal entry must then be prepared in the following period to reverse the entry.For example, a company wants to accrue a $10,000 utility invoice to have the expense hit in June. The company’s June journal entry will be a debit to Utility Expense and a credit to Accrued Payables. On July 1st, the company will reverse this entry (debit to Accrued Payables, credit to Utility Expense). Then, the company theoretically pays the invoice in July, the entry (debit to Utility Expense, credit to cash) will offset the two entries to Utility Expense in July.


What's the Difference Between Quantitative and Qualitative Analysis?

Response: Quantitative analysis applies mathematics and statistics and uses hard data and numbers. Qualitative analysis, on the other hand, involves elements that cannot be measured or expressed as a number. It can include features that are subjective and opinions.


Is it true that some hedge funds have direct links (e.g. fiber optic cable) to major financial exchanges?

Response: Yes. The largest and most sophisticated hedge funds have direct fiber optic connections to the largest financial exchanges. Most High Frequency Trading (HFT) outfits rely on such connections to gain a nano-second advantage over their competitors and to satisfy the demands of their high-frequency algorithms.


Response: Retirement planning isn't difficult. It's as easy as setting aside some money every month—every little bit counts. The easiest way is to start contributing through an employer-sponsored plan if your company offers one. You may also want to consider talking to a professional, such as a financial planner or investment broker who can steer you in the right direction. The earlier you start, the better. That's because your investments grow over time by earning interest. And you'll earn interest on that interest.


What Is the Yearly Probability of Living?

Response: The yearly probability of living is basically the flip side of the yearly probability of dying. Also based on mortality tables, it is an estimate of the likelihood of an individual still being alive a year into the future, based on their age, sex, and sometimes other factors. Like the yearly probability of dying, it is widely used in the insurance industry.While a person’s yearly probability of dying rises as they age, their yearly probability of living goes in the opposite direction.


Which U.S. President Imposed the First Federal Income Tax?

Response: President Abraham Lincoln was the president to impose the first federal income tax by signing the Revenue Act on Aug. 5, 1861. The reason he did so was to finance the Civil War. A 3% tax was imposed on all annual incomes over $800.


Response: Yes, a disregarded entity pays taxes. But since by definition it's usually a single-person business or company, it's not treated or taxed separately from its owner by the IRS. It reports its income on the owner's personal tax return.Disregarded entities pay two types of taxes, similar to sole proprietorships:Self-employment tax (a flat rate)Income tax (variable rate, depending on the individual owner's tax bracket)


What Is the Difference Between Ex Works and FOB?

Response: In shipping arrangements, the difference between Free on Board and Ex Works is based on transferring the liability of goods between the buyer and seller. In free-on-board contracts, the seller takes responsibility for bringing goods to a terminal in addition to customs costs and loading the goods onto the ship. The buyer, meanwhile, is liable for shipping costs, insurance, and customs costs at the final point of arrival. In other words, once the goods are shipped, the buyer assumes liability and ownership of the goods, known as “FOB origin” or “FOB shipping point.” By contrast, in an Ex Works agreement, the seller is only responsible for delivering goods to an agreed-upon location.


What Are the Different Types of Philanthropy?

Response: Philanthropy can take on many different forms. It can be done by individuals and corporations. There can be a combination of both, where a company does matching donations whenever someone makes a donation. Or it can be done by bequest, which means instructions are left to give money and other assets to charity in a trust or someone's will. People can donate money directly to charity, fund scholarships, or offer grants and stipends. And it isn't just money that falls under the philanthropic umbrella. In fact, people can donate their time through volunteer work.


Response: The federal funds rate is the rate at which depository institutions lend available balances held by the Fed to each other overnight.


What Is the Difference Between Tapering and Tightening?

Response: Tight, or contractionary policy is a course of action by a central bank to slow down economic growth, constrict spending in an economy that is seen to be accelerating too quickly, or curb inflation when it is rising too fast. The Fed tightens monetary policy by raising short-term interest rates through policy changes to the discount rate, also known as the federal funds rate. The Fed may also sell assets on the central bank's balance sheet to the market through open market operations (OMO). Tapering refers to the period of reversal between expansionary policy and contractionary monetary policy.


Response: Yes, total gross income is your salary. It is the amount of money you have before taxes and other adjustments are deducted. For example, if you had an annual salary from your employer of $100,000, that would be your gross income. After taxes and other adjustments, you take home $65,000, which is your net income.


What is the most important concept in all of macroeconomics?

Response: The most important concept in all of macroeconomics is said to be output, which refers to the total amount of good and services a country produces. Output is often considered a snapshot of an economy at a given moment.


Response: In December 2016, OPEC formed an alliance with other oil-exporting nations that were not a part of the organization, creating an entity that is commonly referred to as OPEC+, or OPEC Plus. Prominent members of OPEC+ include Russia, Mexico, and Kazakhstan. Working in coordination with additional oil-exporting countries makes the organization even more influential when it comes to international energy prices and the global economy.


Response: Jack Welch was considered a good leader because of his vision of quick growth during times of economic slowdown. As chair and CEO of GE, he looked for inconsistencies and streamlined the company's businesses. He eliminated wasteful divisions and unproductive management personnel. He also attempted to remove the formalities of business by creating an informal environment.


Which Is a Primary Use for National Income Accounting?

Response: National income accounting is used to measure economic growth and activity. It can also be useful in tracking trends and guiding monetary policy, such as policy tax rate setting.


Response: Assurance in auditing refers to the opinions issued by a professional regarding the accuracy and completeness of what's analyzed. For example, an accountant assuring that financial statements are accurate and valid asserts that they have reviewed the documents using acceptable accounting standards and principles.


Why Would I Use a PERT Chart Instead of a Gantt Chart?

Response: A PERT chart requires a project manager to think through three possible timelines: Optimistic time is the shortest possible route to completion. Pessimistic time is the longest it might take if everything goes wrong. The most likely time is a reasonable estimate of the best-case scenario.From the outset, the project manager has defined the ideal outcome of a project but also identified the possible barriers to achieving that outcome.


Are Credit Card Application Fees Regulated by Law?

Response: Yes, according to the Federal Reserve Board, "application fees cannot total more than 25% of the initial credit limit. For example, if your initial credit limit is $500, the fees for the first year cannot be more than $125." This limit also applies to annual credit card fees.


Response: The importance of a bill of lading lies in the fact that it’s a legally binding document that provides the carrier and the shipper with all of the necessary details to accurately process a shipment. This implies that it can be used in litigation if the need should arise and that all parties involved will take great pains to ensure the accuracy of the document.Essentially, a bill of lading works as undisputed proof of shipment. Furthermore, a bill of lading allows for the segregation of duties that is a vital part of a firm’s internal control structure to prevent theft.


Response: Trading away means executing a trade through another broker or dealer. One of the benefits of trading away is that the trader is able to place trades with multiple brokers but from one centralized account. This can be useful when one broker, usually the main broker, does not have access to certain markets or instruments.


Response: Practically speaking, it is almost impossible to lose money on a CD for two reasons. First, they are guaranteed by the bank or credit union that offers them, meaning that they are legally required to pay you exactly the amount of interest and principal agreed upon. Second, they are generally also insured by the federal government for up to $250,000. That means that even if the bank or credit union went bankrupt, your principal would very likely still be repaid. For these reasons, CDs are considered one of the safest investments available.


What Are the 5 Major Branches of Social Science?

Response: The five major branches of social science are anthropology, economics, political science, psychology, and sociology. Some people also consider history, law, and geography to be core social sciences.


Response: Adjusted gross income (AGI) is measure of income used by the IRS to asses a taxpayer's tax liability. It equals your gross income minus tax deductions and adjustments to income.


Response: Notching is important because it helps investors to make informed decisions about the creditworthiness of the various bonds and debt instruments issued by the same issuers by using easy to understand ratings, grades, or scores. By understanding the likelihood of default, investors can determine the level of risk they are willing to take on when investing in a particular bond or debt issuer. This is especially important for investors who are considering purchasing high-yield bonds, as these bonds are generally considered to be more risky than investment-grade bonds. Notching can also be used by bond and debt issuers to determine their own creditworthiness, as it can help them to identify any areas where they may need to improve their financial health in order to attract investors.


Why Do Banks Sell Mortgage Servicing Rights?

Response: Banks sell mortgage servicing rights as a way to free up lines of credit. This allows them to lend out more money, ultimately helping more people afford properties.


Response: Compared to other complex languages, VBA is relatively easier to learn. It is considered a beginner-friendly language, and VBA-coders often do not need to have prior experience as a coder to learn the language. In addition, the VBA community has many resources available for individuals new to programming.


What Is Better: A Higher or Lower PEG Ratio?

Response: Lower PEG ratios are better, especially ratios under 1.0.


Response: There are two types of title insurance: lender’s title insurance and owner’s title insurance (including extended policies). Almost all lenders require the borrower to purchase a lender’s title insurance policy to protect the lender in the event that the seller was not legally able to transfer the title of ownership rights. A lender’s policy only protects the lender against loss.Since title searches are not infallible and the owner remains at risk of financial loss, there is a need for additional protection in the form of an owner’s title insurance policy. Owner’s title insurance, often purchased by the seller to protect the buyer against defects in the title, is optional.


Response: A depositary bank works with a foreign company and its custodian bank with a sponsored American depositary receipt. ADRs are otherwise issued by brokers or dealers that own common stock in the foreign company. Unsponsored ADRs aren't commonly available on exchanges.


Response: That depends on the company. In some sectors, particularly those with higher fixed costs, stiff competition, and fluctuating demand, a 7% pretax profit margin might be considered good. In others, it would hint at a lack of efficiency, which could perhaps be the symptom of limited pricing power or poor management of costs.


Why Is It Called a Distribution Waterfall?

Response: Imagine a waterfall cascading down into a series of vertically-aligned buckets. The water represents money, and the buckets represent investors, partners, or stakeholders. The water fills the first bucket first. The second bucket will fill only after the first is completely full and spills over. As water flows, more buckets are filled in the order in which they appear.


Response: The IMF gets its money through quotas and subscriptions from its member countries. These contributions are based on the size of the country's economy, making the U.S., with the world's largest economy, the largest contributor.


What Are Some Qualities of an Effective Leader?

Response: There are several qualities that a good leader should have. Among these include the ability to motivate individuals, a willingness to listen, being trustworthy, having competence, decisiveness, good communication skills, and selflessly understanding the goals of the team or organization.


What Is the Difference Between the Federal Budget Deficit and the Federal Government Debt?

Response: A federal budget deficit occurs when government spending outpaces revenue or income from taxes, fees, and investments. Deficits add to the national debt or federal government debt. If government debt grows faster than gross domestic product (GDP), the debt-to-GDP ratio may balloon, possibly indicating a destabilizing economy.


Why Is the Natural Unemployment Rate Significant?

Response: The natural rate of unemployment is considered the lowest acceptable level that a healthy economy can sustain without creating inflation.


Why Would a Business Want to Become a Multinational Company?

Response: Usually, the primary goal of a business is to increase profits and growth. If it can grow a global customer base and increase its market share abroad, it may believe opening offices in foreign countries is worth the expense and effort. Companies may benefit from certain tax structures or regulatory regimes found abroad.


Response: M2 is seen as a reliable predictor of inflation, so it might be counted among the leading economic indicators. M3 is considered by some economists to be an even better predictor of inflation. This is published quarterly rather than monthly and includes data on large liquid assets held by financial institutions.


How Do Investors Withdraw Money From a Unit Trust?

Response: Investors can exit the fund by selling units at the bid price. To earn a profit, the bid price must be higher than the offer price initially paid for the unit.


Response: The earliest medium of exchange may have been a coin issued about 2,600 years ago in Lydia, an ancient kingdom in what is now western Turkey. The coin was made of a gold and silver alloy, it was stamped with an official government image, and the metal had a guaranteed weight and purity.Gold and other metals may have been used earlier as a medium of exchange, but the Lydians were the first known to have issued it in a standardized form that could be accepted as having a set value.


Response: Dividends, whether in cash or in stock, are the shareholders' cut of the company's profit. They also are a reward for holding the stock rather than selling it. A company may issue a stock dividend rather than cash if it doesn't want to deplete its cash reserves.


What Is the Shortest Term for a Jumbo CD?

Response: Jumbo CD terms can be as short as a few days, but these extremely short terms are hard to find. More commonly, the minimum term for a jumbo CD is three months.


Response: When current interest rates are higher than an existing mortgage's rates, assuming a loan may be the favorable option. Also, there are not as many costs due at closing. On the other hand, if the seller has a considerable amount of equity in the home, the buyer will either have to pay a large down payment or secure a second mortgage for the balance not covered by the existing mortgage.


What Is the Difference Between Charity and Philanthropy?

Response: While some use the words charity and philanthropy interchangeably, philanthropy often casts a broader net of giving. Its role is to help society or groups in the community flourish over a long-term period. Charity is usually based on individual giving and helping in a short-term way, like donating coats to the homeless in winter, helping out or contributing goods to a local food pantry, or sending money to a scholarship fund. These are all acts of charity but may not be considered philanthropic efforts like building a school or a library or donating millions to a scholarship fund.


Response: A checking account lets you store cash safely and securely while enjoying easy access to your money with debit cards, electronic transfers, or checks. People typically use checking accounts for things like on-time, automatic bill payments and making purchases. People also use checking accounts to cash checks and receive direct deposits.


Response: Yes. Regulation B of the Equal Credit Opportunity Act (ECOA) describes lending acts and practices that are specifically prohibited, permitted, or required. for fair lending practices.


Response: Price fixing is an agreement among competitors to raise, lower, maintain, or stabilize prices or price levels. Antitrust laws require that each company establish prices and other competitive terms independently, without agreeing with a competitor. Consumers make choices about what products and services to buy and expect that the price has been determined based on supply and demand, not by an agreement among competitors.


What Are Some Common Strategies for Trading Interest Rate Futures?

Response: These include hedging against interest rate risk, speculating on future rate movements, and spread trading, where traders take positions in different interest rate futures contracts to capitalize on changes in the yield curve. Each strategy requires a thorough understanding of interest rates and the factors that influence them.


What Is the 28/36 Rule for Housing Expenses?

Response: The 28/36 rule for housing expenses essentially states that you should spend no more than 28% of your gross monthly income on housing payments (like rent or mortgage payments) and no more than 36% of your gross income on total debt. Total debt would include payments such as those toward credit cards or personal loans.


What Is the Penalty for Bait and Switch Advertising?

Response: The penalty will depend on the severity of the case and under which laws the case has been prosecuted. If it is a violation of false advertising, the bait and switcher may be fined up to $10,000 and/or up to one year in prison per offense, plus legal fees and damages.


Response: The Inflation Reduction Act (IRA) of 2022 introduced a 1% excise tax on share repurchases of over $1 million, of any US corporation trading on an established exchange. The tax applies if more than $1 million of stock is purchased over the course of the tax year.


Response: Moving averages are widely used in technical analysis, a branch of investing that seeks to understand and profit from the price movement patterns of securities and indices. Generally, technical analysts will use moving averages to detect whether a change in momentum is occurring for a security, such as if there is a sudden downward move in a security’s price. Other times, they will use moving averages to confirm their suspicions that a change might be underway.


What Impact Does Technology and Automation Have on Economic Recovery?

Response: Technology and automation impact economic recovery by influencing employment patterns and income distribution. While driving efficiency, the transition to automation may create job displacement challenges, therefore reducing consumer spending opportunities. However, companies may find they can be more efficient and incur fewer costs when implementing innovation solutions like this. Therefore, individuals must adapt and upskill to continue to not be entirely displaced by emerging technology.


What Is a Disadvantage of Using Electronic Money?

Response: Fraud may be an issue when money can be transferred from one party to another without the necessity for verification of the original owner’s true identity.


Response: MENA stands for the Middle East and Northern Africa, referring to the countries between Iran in the East and Tunisia and Morocco in the West.


Response: Investing is not reserved for the wealthy. You can invest nominal amounts. For example, you can purchase low-priced stocks, deposit small amounts into an interest-bearing savings account, or save until you accumulate a target amount to invest. If your employer offers a retirement plan, such as a 401(k), allocate small amounts from your pay until you can increase your investment. If your employer participates in matching, you may realize that your investment has doubled.You can begin investing in stocks, bonds, and mutual funds or even open an IRA. Starting with $1,000 is nothing to sneeze at. A $1,000 investment in Amazon's IPO in 1997 would yield millions today. This was largely due to several stock splits, but it does not change the result: monumental returns. Savings accounts are available at most financial institutions and don't usually require a large amount to invest. Savings accounts don't typically boast high-interest rates; so, shop around to find one with the best features and most competitive rates.Believe it or not, you can invest in real estate with $1,000. You may not be able to buy an income-producing property, but you can invest in a company that does. A real estate investment trust (REIT) is a company that invests in and manages real estate to drive profits and produce income. With $1,000, you can invest in REIT stocks, mutual funds, or exchange-traded funds.


Response: Marginal cost is the change in production cost from producing or making one additional unit. You can find it by dividing the change in production costs by the change in quantity produced. If the price per unit is higher than the marginal cost, a business can make a profit. Tracking marginal costs allows businesses to achieve economies of scale.


What Are Common Entry Points for Trading Pennant Breakouts?

Response: Common entry points for trading pennant breakouts are typically just above the upper trendline for bullish pennants and just below the lower trendline for bearish pennants.


Response: A validation code often called a CVV code, is a three- or four-digit number on the front or back of your credit or debit card. The code adds a layer of protection in online or phone transactions. Thieves who attempt to use your card number without the physical card can’t supply the validation code if asked.


Response: A CEO often reports to a board of directors. The board oversees the performance of the CEO and can elect to remove or replace the CEO if they feel the executive's performance isn't producing the results they want to see.


Response: Blue chip stocks are the titans of their sectors—industry-defining companies that are well-known, well-capitalized, long-term stable plays with solid financial prospects.


Response: Genuine Progress Indicator (GPI) factors in all the components of the Gross Domestic Product (GDP) and includes environmental and social elements that impact the economy, such as pollution, volunteerism, crime, and climate change. Some economists suggest that GPI is a better metric than GDP as it gives a holistic view of the wellbeing of a nation's economy.


What Impact Does Brain Drain Have on Developing Nations?

Response: Brain drain or the exodus of human capital often has a big impact on developing nations. It often leaves a hole that is hard to fill since there may not be as many people with similar skills to fill that void. It also leads to a loss in tax revenue, which can lead to higher taxation to make up for the shortfall. Citizens may not be able to access quality resources, such as education and health care, which also affects their quality of life.


Why Do Alaska and Hawaii Have Different Poverty Lines?

Response: Poverty guidelines for Alaska and Hawaii are slightly higher than the rest of the states to account for increased costs of living in those regions. The separate set of guidelines is an extension of a practice that has been in place since 1966.


How Do Macroeconomic Factors Affect a Business?

Response: Macroeconomic factors impact the whole population, including businesses. Cyclical companies, in particular, are likely to be more affected by macroeconomic factors as their fate is more closely tied to the state of the economy.


Response: The NYSE was acquired by the Intercontinental Exchange (ICE) group in 2013.


Response: A mixed random variable combines elements of both discrete and continuous random variables.


Response: The first block on the Bitcoin blockchain is the Genesis Block, which has a block height of zero.


Response: RIAs can charge fees in several ways. The most common type of fee is the annual management fee, which is based on the value of a client’s assets under management (AUM) with the RIA. RIAs can also charge fees based on performance, asset class, or hours worked.


Response: In the United States, the three leading stock indexes are the Dow Jones Industrial Average, the S&P 500, the Nasdaq Composite, and the Russell 2000. For international markets, the Financial Times Stock Exchange 100 (FTSE 100) Index and the Nikkei 225 Index are popular proxies for the British and Japanese stock markets, respectively. Most countries with stock exchanges publish at least one index for their major stocks.


Why Are Ginnie Mae Securities Considered a Safe Investment?

Response: Ginnie Mae does not buy or sell loans or issue mortgage-backed securities (MBS) and its balance sheet doesn't use derivatives to hedge or carry long-term debt.


Response: If the price action breaks above the band, the trader should consider initiating long positions while liquidating short positions. If the price action breaks below the band, the trader should consider initiating short positions while exiting long or buy positions.


What Role Does an Investor Relations Division Play Before a Company Goes Public?

Response: Before a company goes public, an investor relations division may assist with establishing corporate governance, conducting internal financial audits, and disseminating information to prospective IPO investors.


Is There a Standard Definition of Income?

Response: The definition of income depends on the context in which the term is used. For example, the tax law uses the concepts of gross income, which includes all income in all its forms, and taxable income, which is gross income net of expenses and other adjustments. On the other hand, the standard for financial accounting—generally accepted accounting principles (GAAP)—uses the term revenue reduced by expenses to determine net income. In addition, the calculation of income will vary depending on the scope of the context—e.g., an individual, a household, an industry, a nation, etc.


What Does Work-in-Progress Mean in Accounting?

Response: In supply-chain management, work-in-progress (WIP) refers to goods that are partially completed. They may also be referred to as in-process inventory. This covers everything from the overhead costs to the raw materials that come together to form the end product at a given stage in the production cycle. In accounting, WIP is considered a current asset and is categorized as a type of inventory.


How Are Demographic Changes Important for Economists?

Response: Economists recognize that one of the major drivers of economic growth is population growth or decline. There is a straightforward relationship when identifying this: Growth Rate of Gross Domestic Product (GDP)=Growth Rate of Population+Growth Rate of GDP per capita, where GDP per capita is simply GDP divided by population. The more people around, the more available workers there are in the labor force, and also more people to consume items like food, energy, cars, and clothes. There are also demographic problems that lie on the horizon, such as an increasing number of retirees who, while no longer in the workforce, are nonetheless expected to live longer lives. Unfortunately, the number of new births seems to be too low to replace those retirees in the workforce.


Response: If a company's board of directors decides to issue an annual 5% dividend per share, and the company’s shares are worth $100, the dividend is $5. If the dividends are issued every quarter, each distribution is $1.25.


Why Is the World Trade Organization Important?

Response: The World Trade Organization (WTO) is the body that keeps global trade running smoothly. It oversees the rules and mediates disputes among its member nations. It now has 164 member nations and 25 observer nations (out of a total 195 nations in the world).


How Can I Get a Rent-Controlled Apartment?

Response: Unfortunately, in most cases, including in New York City, unless a family member who lives in a rent-controlled apartment passes the lease down to you, they are not available to the general public, and rules surrounding the succession of a rent-controlled lease can be complex.


What Is the Difference Between QQQ and QQQQ?

Response: QQQ is the stock ticker symbol for the Invesco 100 Trust exchange-traded fund. QQQQ is the ticker used previously and replaced in 2011.


What Is the Difference Between Title Insurance and a Warranty Deed?

Response: A title company completes a title search and examines public records for any issues or errors. The guarantees and disclosures in a general warranty deed allow the new owner to hold the former owner responsible if there is a title defect or if a claim is made against the title. Title insurance covers a wider range of potential claims than the general warranty deed does, including conflicting estate wills or tax liens.


Who Does the Uniform Commercial Code Protect?

Response: The Uniform Commercial Code (UCC) was established to protect all individuals engaged in a business transaction. It was created to standardize commerce across the states.


Response: Technical analysis examines volume and price movements to predict the behavior of other traders in the market. Because these trades cause price movements, technical analysts hope to predict future price movements based on current market behavior.


Response: No, only those approved by their broker can typically sell naked calls. Understanding the high risks involved, the financial industry has erected specific measures to protect themselves and investors. Brokerages often impose higher margin requirements and proof of significant trading experience before allowing an investor to sell naked calls. These barriers are in place to ensure that only those with a deep understanding of market dynamics and the capacity to absorb potential losses venture into this high-risk territory.


How Can a Race to the Bottom Harm the Environment?

Response: A race to the bottom can occur when countries or regions loosen environmental regulations or enforcement of standards in order to attract more businesses and tax revenue. Producers operating in places with more strict regulations would be incentivized to move to those more lax jurisdictions, where they could pollute more freely. Competition between nations, especially in the developing world, can lead to a series of deregulation that leaves the environment unprotected


What Is the Difference Between Exploration and Production?

Response: Exploration is the process of examining places where abundant oil and natural gas resources potentially exist under the Earth’s surface. Once these places have been identified, production commences to collect and extract.


What Are the Best Short-Term Investments?

Response: Some of the best short-term investment options include short-dated CDs, money market accounts, high-yield savings accounts, government bonds, and Treasury bills. Check their current interest rates or rates of return to discover which is best for you.


Response: Limited partnerships are taxed as pass-through entities, meaning each partner receives a Schedule K-1 to include on their personal tax returns.


Response: Money market accounts and instruments typically yield between 0.01% and 4%. This depends on the amount of money deposited, as some institutions require a higher deposit to earn the higher interest rate.


Response: Common examples of blue chip stocks are market leaders like IBM, Coca-Cola, and McDonald's. These are companies with a long track record of steady growth and low volatility, suggesting that they are unlikely to face major problems in the near future. Blue chips are characterized by a high credit rating, large market capitalization, a listing on the NYSE or another major stock exchange, and are often listed in a major stock market index.


What Is the Difference Between a Bank Loan and a Leveraged Loan?

Response: Leveraged loans—also known as floating-rate loans or bank loans—are loans made by banks or other financial institutions that are then sold to investors. Companies may use the money they get to refinance their debt, fund mergers and acquisitions, or finance projects. The companies that receive these loans typically have credit ratings that are below investment grade. They are secured by collateral such as the borrower's real estate and equipment, or by intellectual property including brands, trademarks, and customer lists.


Response: The 42-gallon barrel was a commonly used standard prior to the 18th century. This sized container was used for shipping everything from fish, molasses, soap, butter, wine, and whale oil. When filled with oil instead of fish or other commodities, a 42-gallon “tierce” weighed 300 pounds. The 42-gallon oil barrel was officially adopted in 1866.


Response: To calculate yield, a security’s net realized return is divided by the principal amount. Importantly, there are different ways to arrive at a security’s yield depending on the type of asset and the type of yield. For stocks, yield is calculated as a security's price increase plus dividends, divided by the purchase price.For bonds, yield can be analyzed as either cost yield or current yield. The cost yield measures the returns as a percentage of the original price of the bond, while current yield is measured in relation to the current price.


Response: The conservatism principle in accounting dictates that estimates, uncertainty, and financial record-keeping should be done in a manner that does not intentionally overstate the financial health of an organization. Historical cost is one way of adhering to the conservatism principle, as companies must report certain assets at cost and have a more difficult time exaggerating the value of the asset.


What Are the Pros and Cons of Belonging to an HOA?

Response: HOAs can benefit individual owners by providing necessary management services. For example, without an HOA the owners of an apartment building would need to coordinate among themselves to decide on common problems such as building-wide garbage removal, building repairs, and community policies. This could be very time-consuming for residents and could result in conflicts and disagreements between owners. On the other hand, HOAs can also create problems for owners to the extent that the owner disagrees with the HOA’s community bylaws or spending decisions.


Response: NAIFA has more than 50,000 members.


What Is the Downside to a Second Mortgage?

Response: Second mortgages increase a homeowner's monthly financial obligations. They can also increase the risk of default if the homeowner is unable to keep up with both the first and second mortgage payments.


How Does Porter's Five Forces Differ from SWOT Analysis?

Response: Both are strategic planning tools, but they serve different purposes. The five-force model analyzes the competitive environment of an industry, looking at its intensity and the bargaining power of suppliers and customers. SWOT analysis, meanwhile, is broader and assesses a company's internal strengths and weaknesses as well as its external opportunities and threats. It can assist in strategic planning by pinpointing areas where the company excels and faces obstacles, helping to align the company's strategy with its internal resources and prospects in the market while mitigating its vulnerabilities and external challenges.


Is a Lifetime Achievement Award Given to an Employee Taxable?

Response: An achievement award may be excluded from taxation as a fringe benefit if it meets specific criteria. For example, it must be worth less than $1,600 and cannot be cash or cash equivalents such as a gift certificate or gift card. It also cannot be stocks, bonds, or other securities. The exclusion doesn't include vacations, meals, lodging, and tickets to theater or sporting events.


Response: Euronext Oslo is another name for the Oslo Stock Exchange. Euronext and NASDAQ entered into bidding for the Oslo Stock Exchange but Euronext was able to secure it in 2019. Euronext is headquartered in Amsterdam and is Europe's largest stock exchange group.


Does Cornell Johnson Have Programs for Veterans?

Response: Cornell Johnson has an Immersion Program that works with veterans as they transition into new careers.


Response: Take this example of a consumer surplus. Let's say that you bought an airline ticket for a flight to Miami during school vacation week for $100, but you were expecting and willing to pay $300 for one ticket. The $200 represents your consumer surplus.


Response: A budget deficit happens when spending is higher than revenue. For a country, this means that its spending is higher than the money is takes in, usually from taxes. When this happens, governments must borrow money, usually by issuing bonds. This increases the country's national debt.


What Types of Companies Report Diluted EPS?

Response: Only publicly traded companies are required to report both EPS and diluted EPS. Private companies are not required to report these figures.


Is India a Member of the Asian Development Bank?

Response: Yes, India is a regional member country of the ADB.


Response: Form 1099-B is used to report capital gains and losses that a taxpayer incurs after selling certain assets through brokerages and barter exchanges. These firms send separate forms for each transaction to both the IRS and the investor.


Response: An isoquant in economics is a curve that, when plotted on a graph, shows all the combinations of two factors that produce a given output. Often used in manufacturing, with capital and labor as the two factors, isoquants can show the optimal combination of inputs that will produce the maximum output at minimum cost.


What Are the Main Types of Intangible Assets?

Response: Intangible assets fall into two different categories: definite, which last for a certain period of time, and indefinite, which have an infinite lifespan. The types of intangible assets include brands, goodwill, and intellectual property.


How Do Non-Executive Directors Differ From Executive Directors?

Response: Non-executive directors are different from executive directors. Executive directors normally work for non-profits and assume the same responsibilities as a CEO, including managing the day-to-day operations, overseeing fundraising, boosting membership, and sticking to a budget. Unlike non-executive directors, many executive directors are not compensated for their time.


Are CML and Efficient Frontier the Same?

Response: CML differs from the more popular efficient frontier in that it includes risk-free investments. The efficient frontier is made up of investment portfolios that offer the highest expected return for a specific level of risk. The intercept point of CML and efficient frontier would result in the most efficient portfolio, called the tangency portfolio.


What are common arguments for and against the Affordable Care Act (ACA)?

Response: Opponents argue that the Affordable Care Act (ACA) hurts small businesses that are required to provide insurance, raises healthcare costs, and creates a reliance on government services by individuals.Proponents state that those with health insurance get medical attention quickly and live a healthier lifestyle. They contend that the healthcare system will operate more efficiently when commercial insurers and their customers do not need to fund the uninsured.