After Superstorm Sandy in 2012, the government offered subsidies to people whose houses were destroyed. How does the expectation that subsidies will be offered again for future disasters affect the probability that risk-averse people will buy insurance and the amount they buy? For example, assume there is a 4% chance of a hurricane that will completely destroy a home worth $200 comma 000. Assume government subsidies will fully replace the value of homes destroyed by a hurricane. The expectation that subsidies will be offered again by the government to replace the value of homes destroyed by hurricanes will result in people A. buying more insurance because homeowners have more wealth with the subsidy. B. buying the same amount of insurance because the subsidy does not affect the price of insurance. C. buying more insurance because the subsidy is received regardless of whether there is a hurricane. D. buying less insurance because the subsidy is at least partially insuring. E. buying the same amount of insurance because the subsidy is only received when there is a hurricane.

Terry, a self-employed laboratory consultant specializing in white mice, attended a convention in paris concerning the care and feeding of white mice. the convention was held in paris since most of the white mice specialists in the world are located in france. terry's expenses were $1,600 for airfare, $400 for food, and $400 for lodging. terry spent 5 days at the convention and 3 days visiting friends. how much can she deduct for the trip?

You have just been hired as a financial analyst for barrington industries. unfortunately, company headquarters (where all of the firm's records are kept) has been destroyed by fire. so, your first job will be to recreate the firm's cash flow statement for the year just ended. the firm had $100,000 in the bank at the end of the prior year, and its working capital accounts except cash remained constant during the year. it earned $5 million in net income during the year but paid $800,000 in dividends to common shareholders. throughout the year, the firm purchased $5.5 million of machinery that was needed for a new project. you have just spoken to the firm's accountants and learned that annual depreciation expense for the year is $450,000; however, the purchase price for the machinery represents additions to property, plant, and equipment before depreciation. finally, you have determined that the only financing done by the firm was to issue long-term debt of $1 million at a 6% interest rate. what was the firm's end- of-year cash balance? recreate the firm's cash flow statement to arrive at your answer

Select the correct answer the smith family adopted a child. the adoption procedure took about three months, and the family incurred various expenses. will the smiths receive and financial benefit for the taxable year? a) they will not receive any financial benefit for adopting the child b) their income tax component will decrease c) they will receive childcare grants d) they will receive a tax credit for the cost borne for adopting the child e) they will receive several tax deductions