Exhibit 4-7

question 38

Short Answer

Exhibit 4-7.An investor in Apple is worried the latest management earnings forecast is too aggressive and the company will fall short.His favorite analyst that covers Apple is going to release his report on Apple the week before the earnings announcement.Report stands for the analyst's report,and Forecast stands for the earnings announcement. Refer to Exhibit 4-7.What is the probability the analyst issued a good report given Apple's earnings announcement was below the forecast?

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Definitions:

Federal Government Revenues

The income received by the federal government from various sources, including taxes, fees, and charges, used to fund public services and projects.

Individual Income Tax

A tax levied on the income of individuals, which varies according to the income levels and other factors.

Proportional Tax

A tax system where the tax rate is fixed and applied uniformly to all taxpayers, regardless of their income level.

Marginal Tax Rate

The percentage of tax applied to your income for each tax bracket in which you qualify, essentially the rate on the last dollar of income earned.