Wood, the receiver of Stanton Oil Company, sued Stanton’s shareholders to recover dividends paid to them for three years, claiming that at the time these dividends
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. Wood, the receiver of Stanton Oil Company, sued
Stanton’s shareholders to recover dividends paid to them
for three years, claiming that at the time these dividends
were declared, Stanton was in fact insolvent. Wood did
not allege that the present creditors were also creditors
when the dividends were paid. Were the dividends
wrongfully paid? Explain
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- 4-4The federal government (1) encouraged the development of the savings and loanindustry, (2) virtually forced the S&L industry to make long-term, fixed-interest-rate mortgages, and (3) forced S&Ls to obtain most of their capital asdeposits that are withdrawable on demand. a.Would the S&Ls be better off if rates are expected to increase or to decreasein the future? b.Would the S&L industry be better off if the individual institutions sold theirmortgages to federal agencies and then collected servicing fees or if theinstitutions held the mortgages that they originated?What caused the downturn, and eventual dissolution, of Long-Term Capital Management LP.? The 1997 Russian default caused a significant rise in U.S. Treasury Bonds, which LTCM was significantly short selling. O With the fall of the Soviet Union, Russia invested in the U.S. markets and destabilized the economy temporarily. O LTCM did not investments in Russian markets when they defaulted on their debts. OLTCM was lying to investors in an effort to inflate their stocks, which they then used to pay their employees in stock options.Suppose instead Larry decides to buy 100 shares of NanoSpeck stock. Which of the following statements are correct? Check all that apply. O C The price of his shares will rise if NanoSpeck issues additional shares of stock. NanoSpeck earns revenue when Larry purchases 100 shares, even if he purchases them from an existing shareholder. Expectations of a recession that will reduce economywide corporate profits will likely cause the value of Larry's shares to decline.
- 3 Select the incorrect statement regarding the relationship between cost behavior and revenue. In a pure fixed cost structure, the unit selling price and unit contribution margin are equal. O A pure fixed cost structure offers higher potential rewards. In a pure variable cost structure, operating leverage is 1 (one). A pure variable cost structure offers more security if volume expectations are not achieved. O In a pure variable cost structure, when revenue increases by $1, so do profits. DENeed help. Assume that securitization combined with borrowing and irrational exuberance in Hyperville have driven up the value of asset-backed financial securities at a geometric rate, specifically from $4 to $8 to $16 to $32 to $64 to $128 over a six-year time period. Over the same period, the value of the assets underlying the securities rose at an arithmetic rate from $4 to $6 to $8 to $10 to $12 to $14. If these patterns hold for decreases as well as for increases, by how much would the value of the financial securities decline if the value of the underlying asset suddenly and unexpectedly fell by $6? Instructions: Give your answer as a whole number.A bank has £2 million assets and £1.8 million liabilities. What is the percentage fall in the asset value that will render the bank insolvent? O 7% O 8% O Greater than 10%
- A Company's stock currently pays a dividend of $5 dollars per year and you expect that dividend to grow by 3% every year, forever, such that next year you expect the dividend to be 5.15, to be 5.3045 the year after that, and so on. If your discount rate is 9%, a fair price for this stock today is_____.If your discount rate were to fall to 7%, holding all else the same, the fair price of the stock would increase to_________.Question 20 If I pay off my entire credit card bill before this date, I do not have to pay interest on the money I have borrowed on my credit card. What is this called? O A. Forbearance period. O B. Grace period. Oc. Default. O D. Probationary period. Save and Quit DELL Ce & # 7 8. 4. e f 1. S d.5. Kraft is a limited partner of Johnson Enterprises, a limited partnership. As provided in the limited partnershipagreement, Kraft decided to leave the partnership anddemanded that her capital contribution of $20,000 bereturned. At this time, the partnership assets were$150,000 and liabilities to all creditors totaled $140,000.The partnership returned to Kraft her capital contribution of$20,000.a. What liability, if any, does Kraft have to the creditorsof Johnson Enterprises?b. If Johnson Enterprises had been formed as a limitedliability company, what liability, if any, would Krafthave to the creditors of Johnson Enterprises?
- How do the shareholders who own a company choose the actual company managers?The Darkroom Windowshade Company has 100,000 shares of stock outstanding. The investors in the firm awn the following numbers of shares: investor 1 has 20,000 shares; investor 2 has 18,000 shares; investor 3 has 15,000 shares; investor 4 has 10,000 shares; investor 5 has 7,000 shares; and investors 6 through 11 have 5,000 shares each. What is the minimum number of investors it would take to vote to change the companys top management? If investors I and 2 agree to vote together, can they be certain of always getting their way in how the company will he run?Explain why a financial investor in stocks cannot earn high capital gains simply by buying companies with a demonstrated record of high profits.
