Response:
1. Stabilizing the Real Estate Market:
Due to the onset of economic instability, property and financial asset values plummeted sharply. Both strategies from Singapore and Hong Kong suggested halting government land sales until the fiscal year ends. Additionally, to diminish property supply further, the Singapore plan suggested enabling developers to postpone the completion of ongoing construction projects. To boost demand, stamp duties on uncompleted property purchases were deferred. Furthermore, the Hong Kong government implemented a demand-side approach by widening eligibility for starter loan and home purchase schemes.
2. Stabilizing the Financial Sector
:
The Singapore plan intended to prompt banks to adequately prepare for their loan exposures in the region. It annulled a 3% cap on tax deductions for general provisions prepared by banks and financial institutions. Stamp duties on contract notes were also eliminated. The Hong Kong strategy introduced tax exemptions on local interest earnings to encourage the repatriation of an estimated HK$200 billion in offshore deposits. This move would enhance liquidity within the banking sector and increase the supply of Hong Kong dollars.
3. Stimulating Business Activity
:
Both strategies put forward tax reliefs to lower business expenditures. The Singapore approach recommended additional 40% tax rebates on top of the existing 15% allocated in the budget for commercial and industrial properties. Rental alleviations were extended to tenants and lessees in government-operated industrial estates. Other incentives included tariff cuts and the suspension of parking surcharges. The Hong Kong plan also proposed measures for cost reduction such as rate rebates and a decrease in diesel duty. Fees charged to importers were subsequently lowered. This strategy aimed to assist small and medium enterprises in securing loans, potentially reducing bankruptcy rates and enabling unemployed individuals to launch their own businesses, which was encouraged by the Hong Kong government as the unemployment rate began to rise.
<span>The primary issue at Bond's Gym is that demand exceeds capacity. Therefore, implementing negative incentives is the most effective approach. Positive incentives would only attract more customers, worsening the situation. Negative incentives could benefit the owner by increasing revenue and enabling gym expansion to serve more clients.</span>
The gain amounts to $370
Reasoning:
To determine the gain or loss for the date 12/31/2018, according to ABC's amortization schedule
On this date, the carrying value was $196,370 while ABC procured the bonds back for $196,000 on 12/31/2018
Now let’s compute the gain or loss using this formula
Gain/Loss = Carrying value - Bond stock
Substituting into the formula gives us Gain/Loss =$196,370-$196,000
Gain/Loss=$370
Therefore, on the date 12/31/2018, ABC will show a gain of $370
