miller5452

09.07.2019 • 

Business

Address the following by searching the fasb asc topic 810 on consolidation. 1. what are protective noncontrolling rights? 2. what are substantive participating noncontrolling rights? 3. what noncontrolling rights overcome the presumption that all majority-owned investees should be consolidated? 4. zee company buys 60 percent of the voting stock of bee company with the remaining 40 percent noncontrolling interest held by bee's former owners, who negotiated the following noncontrolling rights: • any new debt above $1,000,000 must be approved by the 40 percent noncontrolling shareholders. • any dividends or other cash distributions to owners in excess of customary historical amounts must be approved by the 40 percent noncontrolling shareholders. according to the fasb asc, what are the issues in determining whether zee should consolidate bee or report its investment in bee under the equity method?

Ответ:

lemoinedegraw

05.07.2022

Business

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a) 8%

b) 5%

c) 4%

Explanation:

Given:

Growth in real GDP = 3%

Growth of money stock = 8%

Nominal interest rate = 9%

Now,

(a) As per Classical Quantity Theory of Money

Money Supply (M) × Velocity (V) = Price level (P) × Real GDP (Y)

also,

Nominal GDP = P × Y

Change in M + Change in V = Change in P + Change in Y

Since,

V = Constant

thus, Change in V = 0

Change in M = Change in P + Change in Y

Change in P + Change in Y = Change in Nominal GDP = Change in M

thus,

Change in Nominal GDP = 8%  

(b)

8% = Change in P + Change in Y

8% = Change in P + 3%

Change in P = Inflation Rate = (8 - 3)% = 5%

(c) Real interest rate = Nominal interest rate - Inflation rate

= (9 - 5)%

= 4%

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