In each of the following scenarios, explain and categorize the cost of inflation. a. Because inflation has risen, the clothing company decides to issue a new catalog monthly rather than quarterly.
b. Grandpa buys an annuity for $100,000 from an insurance company, which promises to pay him $10,000 a year for the rest of his life. After buying it, he is surprised that high inflation triples the price level over the next few years.
c. Maria lives in an economy with hyperinflation. Each day after being paid, she runs to the store as quickly as possible so she can spend her money before it loses value.
d. City lives in an economy with an inflation rate of 10 percent. Over the past year, she earned a return of $50,000 on her million-dollar portfolio of stocks and bonds. Because her tax rate is 20 percent, she paid $10,000 to the government.
e. Your father tells you that when he was your age, he worked for only $4 an hour. He suggests that you are lucky to have a job that pays $9 an hour.

Lavage rapide is a canadian company that owns and operates a large automatic car wash facility near montreal. the following table provides data concerning the company’s costs: fixed cost per month cost per car washed cleaning supplies $ 0.70 electricity $ 1,400 $ 0.07 maintenance $ 0.15 wages and salaries $ 4,900 $ 0.30 depreciation $ 8,300 rent $ 1,900 administrative expenses $ 1,400 $ 0.03 for example, electricity costs are $1,400 per month plus $0.07 per car washed. the company expects to wash 8,000 cars in august and to collect an average of $6.50 per car washed. the actual operating results for august appear below. lavage rapide income statement for the month ended august 31 actual cars washed 8,100 revenue $ 54,100 expenses: cleaning supplies 6,100 electricity 1,930 maintenance 1,440 wages and salaries 7,660 depreciation 8,300 rent 2,100 administrative expenses 1,540 total expense 29,070 net operating income $ 25,030 required: calculate the company's revenue and spending variances for august.

The master manufacturing company has just announced a tender offer for its own common stock. master is offering to buy up to 100% of the company's stock at $20 per share contingent on at least 64% of the outstanding shares being tendered. after the announcement of the offer, the stock closed on the nyse up 2.50 at $18.75. a customer has 100 shares of master stock in his cash account. the customer tells you that he wishes to "cash out" his position. you should recommend that the customer:

In a fixed-term, level-payment reverse mortgage, sometimes called a reverse annuity mortgage, or ram, a lender agrees to pay the homeowner a monthly payment, or annuity, and expects to be repaid from the homeowner’s equity when he or she sells the home or obtains other financing to pay off the ram. consider a household that owns a $150,000 home free and clear of mortgage debt. the ram lender agrees to a $100,000 ram for 10 years at 6 percent. assume payments are made annually, at the beginning of each year to the homeowner. calculate the annual payment on the ram.