Dave Scott bought a used car in early 2007 for $12,000. He borrowed $11,000, which he is repaying over four years
During 2007, he made payments of $3,600, of which $800 was interest and $2,800 was repayment of principal. Dave believes the car depreciated about $4,000 in 2007. Given the above data we can say that by the end of 2005 the car had
A)
increased Dave's net worth by $8,200.
B)
decreased Dave's net worth by $4,800.
C)
increased Dave's assets by $12,000, increased his liabilities by $11,000, and increased his net worth by $1,000.
D)
decreased Dave's net worth by $200.
D
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A goal can be achieved at the expense of another lower-priority goal
Indicate whether this statement is true or false.
The risk-free rate of return is 3% and the expected return on the market portfolio is 14%. Oklahoma
Oilco has a beta of 2.0 and a standard deviation of returns of 26%. Oilco's marginal tax rate is 35%. Analysts expect Oilco's net income to grow by 12% per year for the next 5 years. Using the capital asset pricing model, what is Oklahoma Oilco's cost of retained earnings? A) 18.6% B) 21.2% C) 25.0% D) 22.8%