Answer:
measure forecast accuracy
Explanation:
The main purpose for using the mean absolute error is to do the forecast in an accurate manner. Also, it provides the measure for total forecast error for the given model
Therefore as per the given situation, the above represent the answer as neither it remove the error, nor estimated the trend line, etc
So, the same should be considered
EPS, P/E Ratio, and Dividend Ratios The Stockholders' Equity section of the balance sheet for Balla Enterprises at the end of 2017 appears as follows: 8%, $100 par, cumulative preferred stock, 200,000 shares authorized, 50,000 shares issued and outstanding $5,000,000 Additional paid-in capital on preferred 2,500,000 Common stock, $5 par, 500,000 shares authorized, 400,000 shares issued and outstanding 2,000,000 Additional paid-in capital on common 18,000,000 Retained earnings 37,500,000 Total stockholders' equity $65,000,000 Net income for the year was $1,350,000. Dividends were declared and paid on the preferred shares during the year, and a quarterly dividend of $0.40 per share was declared and paid each quarter on the common shares. The closing market price for the common shares on December 31, 2017, was $27.65 per share.
Required:
1. Compute the following ratios for the common stock:
When required, round earnings per share and price/earnings ratio answers to two decimal places. For dividend payout and dividend yield ratios, round raw calculations to 4 decimal places, but enter each answer as a percentage to two decimal places; for example, .17856 rounds to .1786 and would be entered as 17.86, indicating 17.86%.
a. Earnings per share $
b. Price/earnings ratio to 1
c. Dividend payout ratio %
d. Dividend yield ratio %
2. Before recommending the stock of Balla to a client, as a financial adviser, you would like to know:
future earnings growth.
risk of the stock.
general economic trends and how they affect the company.
all of these.
Answer:
Balla Enterprises
1. Ratios for the common stock:
a. Earnings per share = Net income after preferred dividend/ Outstanding common stock shares
= $2.38
b. Price/Earnings ratio
= 11.62x
c. Dividend payout ratio
= 67.23%
d. Dividend Yield = Dividend per share/Market price per share
= 5.79%
2. Before recommending the stock of Balla to a client, as a financial adviser, you would like to know:
all of these.
Explanation:
a) Data and Calculations:
Balla Enterprises
The Stockholders' Equity section of the balance sheet at the end of 2017 8%, $100 par, cumulative preferred stock:
200,000 shares authorized
50,000 shares issued and outstanding $5,000,000
Additional paid-in capital on preferred 2,500,000
Common stock, $5 par, 500,000 shares authorized,
400,000 shares issued and outstanding 2,000,000
Additional paid-in capital on common 18,000,000
Retained earnings 37,500,000
Total stockholders' equity $65,000,000
Net income for the year = $1,350,000
Dividends:
Preferred stock = $400,000 ($5,000,000 * 8%)
Earnings after preferred dividend = $950,000 ($1,350,000 -$400,000)
Common stock = $640,000 ($0.40 * 4 * 400,000)
Closing market price of common stock on Dec. 31, 2017 = $27.65
1. Ratios for the common stock:
a. Earnings per share = Net income after preferred dividend/ Outstanding common stock shares
= $2.38 ($950,000/400,000)
b. Price/Earnings ratio = Market price of common stock/Earnings per share
= 11.62x ($27.65/$2.38)
c. Dividend payout ratio = Dividend per share/Earnings per share
= $1.60/$2.38
= 0.6723
= 67.23%
d. Dividend Yield = Dividend per share/Market price per share
= $1.60/$27.65
= 0.0579
= 5.79%
2. Before recommending the stock of Balla to a client, as a financial adviser, you would like to know:
all of these.
Pinacle Corp. budgeted $242,600 of overhead cost for the current year. Actual overhead costs for the year were $204,330. Pinacle's plantwide allocation base, machine hours, was budgeted at 51,060 hours. Actual machine hours were 56,680. A total of 102,310 units was budgeted to be produced and 98,000 units were actually produced. Pinacle's plantwide factory overhead rate for the current year is: a.$4.00 per machine hour b.$4.75 per machine hour c.$2.00 per machine hour d.$2.37 per machine hour
Answer:
Predetermined manufacturing overhead rate= $4.75 per machine hour
Explanation:
Giving the following information:
Pinacle Corp. budgeted $242,600 of overhead cost for the current year.
Estimated machine hours= 51,060 hours
To calculate the predetermined overhead rate, we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 242,600 / 51,060
Predetermined manufacturing overhead rate= $4.75 per machine hour
The Rent It Company declared a dividend of $.60 a share on October 20th to holders of record on Monday, November 1st. The dividend is payable on December 1st. You purchased 100 shares of this stock on Wednesday, October 27th. How much dividend income will you receive on December 1st as a result of this declaration
Answer:
the dividend income that should be received is $60
Explanation:
The computation of the dividend income is shown below:
= Dividend per share × number of shares of the stock purchased
= $0.60 × 100 shares
= $60
hence, the dividend income that should be received is $60
Basically we applied the above formula so that the correct value could come
Why hasn't globalization benefited the majority of the world's underdeveloped countries?
A. underdeveloped countries don't have the natural resources needed to fuel high levels of industrial production
B. underdeveloped countries use protectionist policies to isolate themselves from international trade
C. underdeveloped countries rely on exporting agricultural goods to developed countries
D. underdeveloped countries don't have the productive capacities necessary to take advantage of increasing national trade
The answer is D. Under developed countries don’t have the productive capacities necessary to take advantage of increasing national trade
Quick Cleaners, Inc. (QCI), has been in business for several years. It specializes in cleaning houses but has some small business clients as well.
a. Issued $21,000 of QCI stock for cash.
b. Incurred $840 of utilities costs this month and will pay them next month.
c. Paid wages for the current month, totaling $2,600.
d. Performed cleaning services on account worth $3,800.
e. Some of Quick Cleaners’ equipment was repaired at a total cost of $300. The company paid the full amount at the time the repair work was done.
Required:
Prepare journal entries for the above transactions, which occurred during a recent month.
Answer:
Quick Cleaners, Inc. (QCI)
Journal Entries
a. Debit Cash $21,000
Credit Common Stock $21,000
To record the issuance of QCI stock for cash.
b. Debit Utilities Expense $840
Credit Utilities Payable $840
To accrue utilities expense for the month.
c. Debit Wages Expense $2,600
Credit Cash $2,600
To record the payment of wages for the month.
d. Debit Accounts Receivable $3,800
Credit Service Revenue $3,800
To record the performance of cleaning services on account.
e. Debit Equipment Repairs $300
Credit Cash $300
To record the payment for equipment repairs.
Explanation:
a) Data and Analysis:
a. Cash $21,000 Common Stock $21,000
b. Utilities Expense $840 Utilities Payable $840
c. Wages Expense $2,600 Cash $2,800
d. Accounts Receivable $3,800 Service Revenue $3,800
e. Equipment Repairs $300 Cash $300
Leo is the most active participant on his company's social networking platform, but his manager has an issue with one aspect of his posts. Which behavior is Leo's manager most likely to ask him to change
Group of answer choices.
A. He never addresses colleagues by name to keep things professional.
B. He always uses a friendly, but direct tone.
C. He often requests that colleagues post work-related data.
D. He spends time on the platform each day.
E. He often reminds colleagues to share their ideas through the platform
Answer:
A. He never addresses colleagues by name to keep things professional.
Explanation:
Operant conditioning can be defined as an associative learning process which involves reinforcing the strength of a behavior.
Behavior modification is a therapeutic process that is focused on changing any undesirable negative behavior in an individual through the use of positive or negative consequence and biofeedback.
Basically, behavior modification is based on operant conditioning principles, through negative or positive reinforcement, undesirable behaviors developed by an individual are mainly replaced with more desirable ones.
In this scenario, a behavior which Leo's manager is most likely to ask him to change is not addressing colleagues by name to keep things professional.
In a corporate or formal setting such as on a company's social network platform, it is very important that group members (employees) address their colleagues by name at all times. This behavior or action, is necessary to keep things professional and show individual interests in your colleagues.
On January 2, Dog Mart prepaid $19,920 rent for the year and recorded the prepayment in an asset account. Prepare the January 31 adjusting entry for rent expense. If an amount box does not require an entry, leave it blank. Jan. 31 fill in the blank 2 fill in the blank 3 fill in the blank 5 fill in the blank 6
Answer:
Debit : Rent Expense $1,660
Credit : Prepaid Rent $1,660
Explanation:
The January 31 adjusting entry for rent expense would include a Debit to Rent Expense and Credit to Prepaid Rent - Asset Account at an amount of $1,660.
Calculation :
Rent Expense = 1/12 x $19,920 = $1,660
how can strategic leaders be successful in an industry like the airlines industry
Answer:
Strategic leaders can help any airline related issue to be solved
Explanation:
Strategic leaders are needed everywhere. An airline company would indeed benefit from a strategic leader and or manager
The following labor standards have been established for a particular product: Standard labor hours per unit of output 4.4 hours Standard labor rate $ 17.70 per hour The following data pertain to operations concerning the product for the last month: Actual hours worked 6,200 hours Actual total labor cost $ 110,360 Actual output 1,300 units Required: a. What is the labor rate variance for the month? b. What is the labor efficiency variance for the month?
Answer:
Results are below.
Explanation:
To calculate the direct labor rate variance, we need to use the following formula:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Direct labor rate variance= (17.7 - 17.8)*6,200
Direct labor rate variance= $620 unfavorable
Actual rate= 110,360/6,200= $17.8
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Direct labor time (efficiency) variance= (1,300*4.4 - 6,200)*17.7
Direct labor time (efficiency) variance= $8,496 unfavorable
In 2011, Starbucks terminated a contract with Kraft Foods that allowed Kraft to sell bagged Starbucks coffee in grocery stores. The early termination resulted in litigation between Kraft and Starbucks. After an arbitrator found in Kraft's favor, Starbucks recorded a liability for $2.8 billion.
Required:
This behavior is typical of many companies today. What is your opinion on the reasons companies behave this way? Is it realistic? Why or why not?
Answer:
Starbucks and Kraft Foods
The reasons companies terminate contracts before their expiration include impossibility of performance, material breaches of contract terms, misrepresentation, fraud, lack of capacity, mutual mistake, and frustration.
The reason for Starbucks' termination of the contract was "multiple material breaches." These were not established by the arbitrator, who delivered judgment in Kraft's favor.
It is not always realistic to terminate a long-standing contract without abiding by the contract termination terms because the damages and accruing interests that can be awarded against the terminating company may be too huge.
Explanation:
The "multiple material breaches" that Starbucks alleged against Kraft included the allegation that "Kraft did not always meet minimum advertising budgets or keep Starbucks involved in major initiatives." According to Starbucks, these violations eroded its "brand equity."
The first step in drawing a strategic group map is Multiple choice question. assign firms occupying the same map location to a common strategic group. draw circles around each strategic group that are proportional to the group's share of industry revenues. plot firms on a two-variable map based on the strategic variables. identify the variables based on strategic approaches used in the industry.
Answer:
identify the variables based on strategic approaches used in the industry.
Explanation:
The first and foremost step while drawing the strategic group is that we have to identify the variable that should be depend upon the strategic approaches and the same should be used in the industry as the strategic groups map refer to the tool that captures the competitive landscape essence
So, the last option is correct
Select the correct answer
What is a federal budget
A
an evaluation of the government's current revenue sures
an estimate of the government's total revenue and spending
a calentation of the amount needed to make the government debt free
a comparison of the government's foreign and domestie earnings
Resol
Next
B) an estimate of the government's total revenue and spending
FabFitFun Coupon Code FabFitFun Coupon Code is the best way to avail discounts on FabFitFun store shopping, there are lots of items on which you can avail the discount, amazing offers so visit the store by clicking the button and Save your Pocket now!
FabFitFun Coupon Code
https://couponsagent.com/front/store-profile/fabfitfun-coupon-code
Answer: Please don’t advertise here
Answer:
dont advertise
Explanation:
Hector is opening an appliance store. He has estimated a monthly profit goal based on his anticipated expenses and earning goals and uses it to set product prices. Hector is implementing a ________ pricing strategy.
Answer:
target return on investment (ROI)
Explanation:
THESE ARE THE OPTIONS FOR THE QUESTION BELOW
A) penetration
B) price skimming
C) target return on investment (ROI)
D) competitor-based
E) value
From the question, we are informed about the Hector who is opening an appliance store. He has estimated a monthly profit goal based on his anticipated expenses and earning goals and uses it to set product prices. Hector is implementing a target return on investment (ROI) pricing strategy.
Target return on investment pricing model can be regarded as one in which price is determined by investor/Business based on what the business owner intend to make from his/her capital that is invested in the business. An investor can calculate Target return ccalculated as the money invested in a venture along as the profit that investor intend to see as return, which is been adjusted for the time value of money. As regards to return-on-investment method, It is required by the investor work in backward direction so as to to reach a current price for target return pricing.
Theo quan điểm hiện đại khi tiếp cận chi phí chất lượng, chi phí chất lượng thấp nhất là khi
Answer:
Translate in English please!!!!!!!!!!!!!
A manager's need to exert tight controls on subordinates (span of control) is most accurately captured by which of the following statements?
A. Control will decrease as the manager gets to higher levels in the organization and work becomes less standardized.
B. Control is generally the same in almost all organizations.
C. Control will clearly increase as subordinates need less supervision.
D. Control will decrease as new employees join the company.
Answer:
b
Explanation:
The phrase Control will decrease as the manager climbs to higher levels in the organization and work becomes less standardized best describes a manager's need to exert tight controls on subordinates (span of control).
Thus, option A is correct.
What is the ideal span of control?For all businesses, assessing the scope of control is a useful health check. Organizations can easily identify potential areas for improvement or issue areas by visualizing spans and layers. The number of employees directly under management is referred to as the span of control. The number of subordinates that a supervisor or manager in an organization can effectively and efficiently supervise is referred to as the span of control.
A manager with five direct reports, for instance, has a span of control of five. As long as it is considered in the context of the company's organizational structure, having too many or too few direct reports is a useful indicator of how effective an organization is.
For more information about the span of control refer to the link:
https://brainly.com/question/13678908
#SPJ2
For each of the following transactions below, prepare the journal entry (if one is required) to record the initial transaction and then prepare the adjusting entry, if any, required on September 30, the end of the fiscal year. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
(a) On September 1, paid rent on the track facility for three months, $213,000.
(b) On September 1, sold season tickets for admission to the racetrack. The racing season is year-round with 25 racing days each month. Season ticket sales totaled $840,000.
(c) On September 1, borrowed $300,000 from First National Bank by issuing a 6% note payable due in three months.
(d) On September 5, programs for 20 racing days in September, 25 racing days in October, and 25 racing days in November were printed for $3,500.
(e) The accountant for the concessions company reported that gross receipts for September were $160,000. Eight percent is due to the track and will be remitted by October 10.
Answer and Explanation:
the journal entries are as follows:
a Prepaid rent $213,000
To cash $213,000
(To record prepaid rent)
Adjusting entry:
Rent expense $71,000 ($213,000 ÷ 3)
Prepaid rent $71,000
(To record September rent expense)
b Cash $840,000
To unearned sales revenue $840,000
(To record cash received on season sales)
Adjusting entry:
Unearned sales revenue ($840,000 ÷ 12) $70,000
Sales revenue $70,000
(To record sales revenue recognised)
c Cash $300,000
Note payable $300,000
(To record note payable issued on borrowed amount )
Adjusting entry:
Interest expense ($300,000 × 6% ÷ 12) $1,500
Interest payable $1,500
(To record interest payable due)
d Prepaid advertising 3,500
To Cash 3,500
(To record cash paid for advertising)
Adjusting entry:
Advertising expense ($3,500 ÷ 60) × 20 $1,167
To prepaid advertising $1,167
e No entry
Adjusting entry:
Accounte receivable ($160,000 × 8%) $12,800
Sales revenue $12,800
(To record amout due)
According to Ghemawat's earlier observations of CAGE phenomena related to countries and relative distances measured with the framework, countries who share a common currency have a greater probablity of trading with each other than countries who share a common border.
a. True
b. False
Answer:
According to Ghemawat's CAGE framework, "countries who share a common currency have a greater probability of trading with each other than countries who share a common border."
a. True
Explanation:
The CAGE framework was developed by an international strategy guru, Pankaj Ghemawat. CAGE is a cultural, administrative, geographic, and economic framework. The framework offers businesses a means to evaluate the non-physical distances that exist between countries. With this more-inclusive view of distance, the CAGE framework provides another way for business to consider the location, opportunities, and risks involved in global trade or arbitrage.
Economics
Assume there is a new international trade agreement that allows foreign countries to sell their products in the US, what can we predict will happen?
Answer:
1 + 1 = 3 thats the correct answer of your question
Green is self-employed as a human resources consultant and reports on the cash basis for income tax purposes. Select the appropriate tax treatment on Form 1040 (U.S. Individual Income Tax Return) for personal life insurance premiums paid by Green.
a. Fully deductible on Form 1040 to arrive at adjusted gross income
b. Reported in Schedule A, Itemized Deductions (deductibility subject to threshold of 7.5% of adjusted gross income)
c. Reported in Schedule A, Itemized Deductions (deductibility subject to threshold of 2% of adjusted gross income)
d. Not deductible
Answer:
Green (Self-Employed Human Resources Consultant)
The appropriate tax treatment on Form 1040 (U.S. Individual Income Tax Return) for personal life insurance premiums paid by Green is:
d. Not deductible
Explanation:
Green can claim business insurance premiums (regarded as business expenses by the IRS) and healthcare insurance premiums (regarded as medical expenses by the IRS) as deductions, but his personal life insurance premiums are considered as personal expenses. They are not tax-deductible. The IRS regards the payments for life insurance premiums as it regards the purchase of any other product or service for personal consumption.
this is essay .......
Explanation:
that's an essay???! holy
The price of Benzethonium, an active ingredient in hand soap, decreases. How does this decrease in input cost affect the supply of hand soap
Answer:
d. It shifts the supply curve to the left.
Explanation:
When there is any change in the price of the good or service keeping other things constant so it would lead in the movement along with the supply curve. If there is any change in the input cost so it affect the production cost that would shift the supply and on the other hand when the cost is reduced so the shift should be in outward direction and vice versa
Using the information below, calculate net income for the period:
Sales revenues for the period $1,323,000
Operating expenses for the period 258,000
Finished Goods Inventory, January 1 55,000
Finished Goods Inventory, December 31 60,000
Cost of goods manufactured
for the period 559,000
A. $774,000.B. $769,000.C. $530,000.D. $535,000.E. $448,000.
Answer:
See explanation
Explanation:
The correct choice is not available : Net Income is $511,000
We determined this as follows :
Income Statement for the ended December 31
Sales $1,323,000
Less Cost of Sales
Opening Finished Goods Inventory $55,000
Add Cost of goods manufactured $559,000
Less Ending Finished Goods Inventory ($60,000) ($554,000)
Gross Profit $769,000
Less Expenses
Operating expenses ($258,000)
Net Income $511,000
A(n) ________ is a hybrid between a conventional loan and a bond; at its heart it is a bond, but its terms are tailored to the borrower's individual needs, as a loan would be.
Answer:
Private placement
Explanation:
Private placement can be defined as non public offering also. This is because they are not sold through public offering but are sold through Private sales and the the number of investors are few and selected
These investors who receive the bonds are usually selected beforehand instead of doing it in the open market
The position in a craft union in which the holder is the chief administrator of the union hiring hall is the
Answer:
e. international union representative
Explanation:
Union representatives played a vital role with respect to supporting the employees for reporting to the union leaders when they are on the place of their peers. It acted as the main liason between the employers & employees as in this they support the employees and guidem them via the challenges that took place during the work
So at the time when the craft union position where the holder be the chief administrator of the union hiring hall so it should be the international union representative
Number of Output Marginal Product Office Rent Labor Cost TotalCost
Workers boxes of Labor (dollars) (dollars)
0 0 --
1 220 400 200
2 250 800
3 680
4 160 1,200
5 940 1,000
6 980 1,600
Suzette's Fancy Packaging subcontracts with Sunshineland Pecans to box dried fruit and nuts for Suzette's mail order business. Suzette rents space for her factory for $400 a week in a nearby strip mall. She can hire temporary workers for $200 a week. Table 11-5 above shows her output and cost data. Use the table to answer questions a-e.
a. Complete the table.
b. In the last week of summer Suzette closes her business to go on a family vacation. What are her costs during that week?
c. In one week Suzette exactly breaks even. If her revenue for the week is $1,200, how many boxes of fruit and nuts did she produce?
d. Judging from the marginal product of labor data, would you say that Suzette had to settle for increasingly unproductive workers? Explain your answer.
e. Suzette has received an order for 1,500 boxes of nuts per week for the next 3 months. If she expects the trend in the marginal product of labor will continue in the same direction, what do you think she should do? Should she not commit until she can move to a larger space or should she just hire more workers? Explain your answer.
Answer:
a.
Number of Output Marginal Product Office Rent Labor Cost Total Cost
Workers boxes of Labor (dollars) (dollars) (dollars)
0 0 - -
1 220 220 400 200 600
2 470 250 400 400 800
3 680 210 400 600 1,000
4 840 160 400 800 1,200
5 940 100 400 1,000 1,400
6 980 40 400 1,200 1,600
b. The costs during the week of summer vacation are: $400
c. She produced 840 boxes.
d. Yes. Suzette settled for increasingly unproductive workers as the marginal product of labor continued to decline. The cost of paying the workers remained at a flat rate of $200 per week without the corresponding output to show for the labor cost.
e. Suzette will need to hire more workers. However, their average productivity needs to be improved greatly to limit the total labor costs.
Explanation:
a) Data and Calculations:
Number of Output Marginal Product Office Rent Labor Cost Total Cost
Workers boxes of Labor (dollars) (dollars) (dollars)
0 0 - -
1 220 220 400 200 600
2 470 250 400 400 800
3 680 210 400 600 1,000
4 840 160 400 800 1,200
5 940 100 400 1,000 1,400
6 980 40 400 1,200 1,600
You have recently seen a credit card advertisement that states that the annual percentage rate is 10.2 percent. Of the credit card requires monthly payments, what is the effective annual rate of interest on the loan
Answer:
The answer is "[tex]=10.7\%[/tex]".
Explanation:
Using formula:
[tex]EAR=[(1+\frac{APR}{m})^m-1[/tex]
Where m=compounding period
[tex]\to EAR=[(1+\frac{0.102}{12})^{12}]-1[/tex]
[tex]=[(1+0.0085)^{12}]-1\\\\=[(1.0085)^{12}]-1\\\\=1.107-1\\\\=0.107[/tex]
[tex]=10.7\%[/tex]
Which of the following instruments are traded in the capital markets? Check all that apply. Treasury bills Certificates of deposit Common stocks Commercial paper Preferred stocks
Answer:
Common stocks
Preferred stocks
Explanation:
The Capital Market is a place where bonds and stocks are traded however it is only for stocks and bonds with a maturity that lasts over a year. Corporate bonds and government bonds fall under this category as a result.
Stocks represent ownership in a company so this is a long term ownership thing which is why it is traded in the capital market. This includes both common and preferred stock.
PERFECTLY COMPETITIVE MARKETS a. What are the characteristics of a perfectly competitive market? b. What is the criterion used by individual firms in perfectly competitive markets when deciding whether to shutdown or continue production in the short run? c. What is the criterion used by individual firms in perfectly competitive markets when deciding whether to exit the market or continue production in the long run? d. What does the market supply curve in a perfectly competitive market look like in the short run and in the long run? Explain the reason behind the shapes of these market supply curves. e. What is the theoretical justification for supporting the creation of competitive markets? (Hint: Think about welfare economics, ie: consumer surplus, producer surplus, total surplus.)
Answer:
hi im leobel gagwibeidbsisbs
Explanation:
owhshsgspjwvwpusisbsgegwuieueggsosjleob2o1i2539383536345772
An economist wants to study the effect of income on savings. He collected data on 120 identical twins. Which of the following methods of estimation is the most suitable method, if income is correlated with the unobserved family effect, i.e.a) random effects estimationb) nonlinear least squared estimationc) least Squares Dummy Variable (LSDV) approachd) ordinary least squares estimation
Answer:
The correct option is c) least Squares Dummy Variable (LSDV).
Explanation:
Dummy variables can be used in dynamic panel data models to explain the effect of each individual unit of a cross section that is unobserved but accurately characterizes the model of relation. The individual effect is assumed to be fixed across time in each individual in the least squares dummy variable (LSDV) estimation. If the unobserved effect and the explanatory variables are correlated, the assumption of fixed effects gives more exact estimators than the assumption of random effects.
Therefore, the most suitable method, if income is correlated with the unobserved family effect is least Squares Dummy Variable (LSDV).
This implies that the correct option is c) least Squares Dummy Variable (LSDV).
