Business College

Savers make deposits and investments in order to earn what?

Why don't savers invest their money directly with the businesses?

Answers

Answer 1

Answer:

Savers make deposits and investment in order to earn interest on their money. This often works very well because they do not earn only interest as a percentage of their money, but also interest as a percentage of previously accrued interest, something known as compound interest.

Savers do not invest their money directly with the businesses because real economic activity tends to be riskier (although it could also be more profitable for this same reason). This is why they often prefer to invest the money on financial instruments.

Related Questions

Sheffield Corp. includes one coupon in each bag of dog food it sells. In return for eight coupons, customers receive a leash. The leashes cost Sheffield $4 each. Sheffield estimates that 45 percent of the coupons will be redeemed. Data for 2020 and 2021 are as follows:______.
2020 2021
Bags of dog food sold 480000 620000
Leashes purchased 19000 24000
Coupons redeemed 110000 130000
The premium liability at December 31, 2015 is?

Answers

Answer: $108875

Explanation:

First, we calculate the Premium liability at December 31, 2020 which will be:

= (480,000 × 45%) - $110,000/8 × 4

= (216000 - 110000)/8 × 4.

= $53000.

Premium liability at December 31, 2021 will be:

= 53000 + [(620000 × 45%) - $130,000]/8 × 3

= 53000 + 55875

= $108875

A company issued 70 shares of $30 par value preferred stock for $4,000 cash. The journal entry to record the issuance is:______.
A. Debit Cash $2,100; credit Preferred Stock $2,100.
B. Debit Investment in Preferred Stock $2,100; credit Cash $2,100.
C. Debit Cash $4,000; credit Preferred Stock $4,000.
D. Debit Preferred Stock $2,100, debit Investment in Preferred Stock $1,900; credit Cash $4,000.
E. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100.

Answers

Answer:

E. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100.

Explanation:

Journal Entry for Issuance of 70 shares of $30 par value preferred stock for $4,000 is -

Cash Debited -  $4,000

Paid in Capital in excess of Par value Credited -  $1,900

Preferred Stock (70 shares × $30 each) Credited - $2,100

The correct option is - E. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100.

Other Questions
245 tickets in 5 days what is the unit rate What does baripity mean? Why could tropical rain forests be called the "medicine chest of the Earth? Identify the phenotype of the offspring represented by the question mark in Figure 11-4: According to the text, the establishment of the American Law Institute (ALI) was a result of A company issued 70 shares of $30 par value preferred stock for $4,000 cash. The journal entry to record the issuance is:______.A. Debit Cash $2,100; credit Preferred Stock $2,100. B. Debit Investment in Preferred Stock $2,100; credit Cash $2,100. C. Debit Cash $4,000; credit Preferred Stock $4,000. D. Debit Preferred Stock $2,100, debit Investment in Preferred Stock $1,900; credit Cash $4,000. E. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100. The square table has side lengths of 4 feet. What is the length of the diagonal? 6. Find the heat flow in 24 hours through a refrigerator door 30.0" x 58.0" insulated with cellulose fiber 2.0" thick. The temperature inside the refrigerator is 38F. Room temperature is 72F. [answer in BTUs] What is the only continent larger than Africa? aNorth America bAsia cSouth America dEurope match the definitions Why does it divide the points I choose in half? Im new. A town's population went from 40,000 to 50,000. What was the percent of change in the population? 10 POINTS!!!Identify and define literary elements found within a drama, novel, or short story EXPERT HELP: Some species can reproduce sexually or asexually. In which two situations is sexual reproduction advantageous?A. When no individuals of the same species are available for matingB. When many individuals of the same species are available formating.C. When the individuals live in a stable environment in which theythrive.D. When the individuals live in an environment that suddenlychanges. SpointsAregular hexagon is dilated by a scale factor of 0.4 to create a new hexagon. The perimeter of the new hexagon is 0.4 times the perimeter ofthe original hexagonO TrueFalse Sheffield Corp. includes one coupon in each bag of dog food it sells. In return for eight coupons, customers receive a leash. The leashes cost Sheffield $4 each. Sheffield estimates that 45 percent of the coupons will be redeemed. Data for 2020 and 2021 are as follows:______. 2020 2021 Bags of dog food sold 480000 620000 Leashes purchased 19000 24000 Coupons redeemed 110000 130000The premium liability at December 31, 2015 is? What may make it easy for cybercriminals to commit cybercrimes? Select 2 options.Cybercrimes are not classified as real crimes, only as virtual crimes.They operate from countries that do not have strict laws against cybercrime.They are not physically present when the crime is committed.The United States has no law enforcement that acts against them.Law enforcement agencies lack the expertise to investigate them. Please help ASAP!!!! The sound of a trumpet ECHOES off a nearby mountain. This is which type of wave interaction? Which option includes an appositive phrase?A The author, Amy Tan, is a great writer.B Yes. I really enjoyed Fish Cheeks.C Have you read the story the teacher assigned us last week?