Reducing leverage entails the company's capital structure's debt component being reduced. By doing so, the loan will be paid off and WACC will rise. It has no effect on equity cost. The solution to the posed question is E. Its equity cost won't alter.
The weighted average cost of capital (WACC) demonstrates to a business how costly it is to fund new initiatives or other expenses by obtaining funding from outside sources. Stocks and bonds comprise the two main divisions of these sources.
Given that the overall cost of capital is unrelated to the level of leverage, any change in leverage will not affect the firm's overall value or the market price of its shares.
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Natural monopolies: O are common. O are rare. do not exist in the real world. b. Natural monopolies are most often: O in markets with low barriers to entry. O regulated by government. unregulated.
Natural monopolies are rare.
Natural monopolies are most often regulated by government.
It's a monopoly that exists in an industry in which high infrastructural costs and other barriers to entry relative to the size of the market give the largest supplier in a market, an overwhelming advantage over potential competitors.
Why natural monopolies are rare?
It's because the industry needs a high infrastructural cost and also it is not easy to enter the market.
Why natural monopolies are most often regulated by government?
Because if not, then the industry will be able to set the price as high as it wants. Also, monopoly industry will be in very high demand so the government needs to control the industry.
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strategy, size, technology, and the degree of uncertainty in the environment together make up what are called .
Strategy, size, technology, and the degree of uncertainty in the environment together make up what is called a contingency variable.
Contingency variables are the individual factors that could affect the outcome or relationship between two variables. For instance, setting up a company for high production depends on the team of employees managing the company. Therefore, the team of employees is a contingency variable.
Strategy, size, technology, and uncertainty in the environment are the four contingency variables that directly affect the management control system of the company. It affects the type and amount of the production of the company.
Before, setting up a company, these are important contingency variables that determine the possibility of setting up and functioning the business.
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little toy company makes and sells miniature doll houses. little produces two kinds of houses: standard and deluxe. the demand for doll houses is highest in november and december. expecting this trend to continue, little is interested in how to best utilize available capacity. given the following information, how many standard and deluxe doll houses should little produce? standard deluxe demand 8,000 3,000 unit price $60 $80 unit variable cost $25 $35 unit contribution margin $35 $45 production hours per unit 0.5 1 available production hours 5,000 hrs total fixed costs $40,000 a. 5,000 standard; 3,000 deluxe. b. 3,636 standard; 7,364 deluxe. c. 8,000 standard; 1,000 deluxe. d. 3,636 standard; 1,363 deluxe.
The answer is c. 8,000 standard; 1,000 deluxe
Since we have production hours as a limiting factor, therefore we should manufacture that product which gives maximum contribution per hour.
Calculation of contribution per hour
Particulars standard deluxe
Sale price 60 80
(-) variable cost (25) (35)
Contribution per unit 35 45
Units per hour 2 1
Contribution per hour 70 45
Ranking I II
Since the contribution per hour of the standard is more therefore first we should employ resources to manufacture the standard and then remaining to manufacture deluxe.
Calculation of units to be manufactured
Product type Hour per unit Total hours Units
Standard 0.5 4000 (8000x0.5) 8000
Delux 1 1000 1000
Total 5000 hours
Therefore we should manufacture 8000 units of standard and 1000 units of deluxe.
c. 8,000 standards; 1,000 deluxe
Examples of manufacturing include automotive agencies, bakeries, shoemakers, and tailors, as all of them create products, in preference to supplying services. But, for instance, logging or mining are not productions, as they no longer trade items into new merchandise.
System production is a production approach that creates goods by means of combining components, elements, or raw substances using a formula or recipe. It is often used in industries that produce bulk portions of products, together with meals, liquids, delicate oil, gasoline, prescription drugs, chemicals, and plastics.
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angela purchased a corporate bond currently selling for $925 in the secondary market. the bond has a coupon rate of 7.75% and matures in 12 years. which of the following is the yield to maturity on this bond? a) 8.49% b) 4.39% c) 8.77% d) 15.50%
The yield to maturity on this bond is 8.77% at 12 years maturity of 7.75% coupon rate and corporate bond of $925.
The yield to maturity on this bond formula is:
Corporate bond, PV = 925
Semiannual coupon payment; PMT = 38.75 (7.75% × 1,000 ÷ 2)
= 1501.56
FV = 1,000
N = 24 (12 × 2)
Solve for I/YR = 4.387 × 2
= 8.77%
the yield to maturity on this Corporate bond is 8.77%.
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which organization is an independent agency of the federal government that offers managerial and financial help to small businesses
The Small Business Administration organization that offers managerial and financial help to small businesses.
What is SBA? (Small Business Administration )The term Small Business Administration (SBA) refers to a US government agency whose purpose is to support and promote the economy by helping the nation's small businesses. Founded in 1953, SBA's primary mission is to advise individuals who want to start and grow their own businesses.
It offers a number of tools on its website to help new and existing small business owners. The agency is headed by an administrator and deputy administrator and has an attorney general and inspector general—all approved by the Senate.
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which type of feedback has the most impact on an employee and leads to a feeling of trust between the employee and manager?
Positive and negative feedback type of feedback has the most impact on an employee and leads to a feeling of trust between the employee and manager.
What is positive feedback?Positive feedback is a process in a feedback loop that amplifies the effect of a small disturbance. In other words, the effect of a disturbance on the system involves an increase in the magnitude of the disturbance.
Positive feedback enhances or reinforces change, it tends to throw the system out of balance and make it more unstable. Negative feedback tends to dampen or buffer change. it tends to keep the system in a sort of balance, making it more stable.
A positive feedback mechanism, or positive feedback homeostasis, is a pathway that, in response to a variation in output, causes the output to vary even more towards the original deviation.
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very small tools are less productive because they remove material slower due to their reduced size and strength. how should engineers design cost effective part features with regard to the tool size(s) required to produce them?
Engineers should use a step in the design of any physical object is selecting the material. In the context of product design, the main purpose of material selection is to reduce costs while attaining product performance goals.
What is Material Selection?Choosing a material is a phase in the design of any physical object. The major objective of material selection in the context of product design is to minimize costs while achieving product performance goals. The qualities and costs of potential materials serve as the starting point for a methodical selection of the optimum material for a certain application. Using a material index or performance index related to the desired material qualities can frequently help with material selection. For instance, a thermal blanket's thermal conductivity needs to be low in order to reduce the heat transfer for a specific temperature difference.Therefore, engineers should use a step in the design of any physical object is selecting the material. In the context of product design, the main purpose of material selection is to reduce costs while attaining product performance goals.
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In a service business with a highly variable demand, the general approach to aggregate scheduling does not involve.
In a service business with a highly variable demand, the general approach to aggregate scheduling does not involve - Changing demand or running out of stock while business is slow.
Aggregate panning involves –
Aggregate planning is the process of developing, assessing, and maintaining a general scheduling for all of an organization's operations. Customer backlogs, production levels, inventory levels, and forecasted goal sales are frequently included in the overall plan. This schedule seeks to satisfy demand for the least amount of money. When done well, aggregate planning should lessen the drawbacks of day-to-day scheduling, which entails placing small orders for material one week, laying off workers the next, and then placing larger orders and rehiring workers the week after. This longer-term perspective on resource use can lessen the need for unforeseen fluctuations in demand, which can save money. Simply speaking, aggregate planning is an effort to balance capacity and demand while minimizing expenses. This level of planning considers all assets "in the aggregate," such as a product line or family. the term "aggregate" was created. Aggregate resources include things like the total number of workers, machine hours, or raw material tonnage.
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The best example of a floating exchange rate system is (was) the:
a. Bretton Woods system
b. post Bretton Woods system era
c. gold standard
d. League of Nations
The gold standard is the best example of a floating exchange rate system.
In finance, an trade charge is a charge at which one foreign money could be exchanged for every other currency. Currencies are maximum typically countrywide currencies however can be sub-country wide as in the case of Hong Kong or supra-country wide as in the case of the euro.
An exchange charge system, additionally called a forex system, establishes the manner wherein the alternate price is determined, i.e., the fee of the domestic forex with appreciation to different currencies. choosing the currency gadget is a pivotal element of the monetary policy followed by means of a country's authorities.
exchange prices of a currency can be both constant or floating. the constant exchange rate is determined through the important financial institution of the u. s. while the floating fee is determined via the dynamics of market demand and supply.
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a call option on the stock of bedrock boulders has a market price of $9. the stock sells for $30 a share, and the option has a strike price of $26 a share. round your answers to the nearest dollar. what is the exercise value of the call option?
The exercise value of the share is $4
A call option is related to the privilege provided to the buyer so that he can acquire the financial instruments (such as stock, and bonds). The purchaser collects the economic benefit when the value of the underlying asset increases.
The price at which an underlying security may be bought or sold when trading a call or put option is known as the exercise price. It is known as the strike price and is established at the time the trade is opened.
Computing the exercise value of the call option:
Current stock price $30
Deduct: Strike price $(26)
Exercise Value $4
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at the price a monopolist sets, it will sell: multiple choice as much as it wants. less than the quantity demanded to encourage scarcity. as much as consumers are willing to buy. more than a firm in a perfectly competitive market would sell.
It will sell as much as customers are willing to buy, at the price a monopolist sets.
So, the correct option is C.
In monopolies, the price is set above marginal cost, and the company makes a profit. Through perfect competition, a state of equilibrium is created when the supply and price of an item are both economically efficient. A monopoly will establish a monopoly price. When a company is the only manufacturer of the industry's product and faces no real rivals, it has a monopoly.
A monopoly has absolute market power and can set a price above the firm's marginal cost because it has no rivals. Due to his downward-sloping demand curve, a monopolist is only permitted to set prices or output levels; he cannot do both. He cannot have a high price and a large volume of sales since a high price would cause fewer individuals to make purchases.
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energon inc., a beer manufacturer, distributes free water bottles in areas where there is water scarcity. moreover, the company sponsors several local events such as concerts, theatre productions, and sporting events. in this scenario, energon inc. is engaging in .
Energon inc., a beer manufacturer, distributes free water bottles in areas where there is water scarcity. moreover, the company sponsors several local events such as concerts, theatre productions, and sporting events. in this scenario, Energon inc. is engaging in community involvement.
Production is the technique of mixing various material inputs and immaterial inputs (plans, expertise) a good way to make something for intake (output). It is the act of creating an output, a great or carrier which has fee and contributes to the application of people.[1] The place of economics that makes a specialty of production is called production theory, which is intertwined with the intake (or patron) theory of economics. Four elements of production. The production system and output without delay end result from productively making use of the original inputs (or factors of manufacturing). Called primary producer items or offerings, land, labour, and capital are deemed the 3 essential manufacturing elements.
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_____demand describes the overall, or total demand for all final goods and services produced in an economy
Aggregate demand describes the overall, or total demand for all final goods and services produced in an economy.
The total quantity of demand including all completed goods and services generated inside an economy is defined as aggregate demand. The entire amount of money spent on those services and products at a given price level and time is characterized as aggregate demand.
Technically, aggregate demand only resembles GDP over the long run if the price level has already been taken into account. This is because of the fact that short-run aggregate demand assesses all production at a fixed nominal price level, wherein nominal is not inflation-adjusted. Based on the method employed as well as the different components, more variations in the calculations may take place.
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if sales in 2003 were $300,000 and they grew to $500,000 by 2007 (a four-year period), the actual annual compound growth rate was:
The actual annual compound growth rate is ( $1.67)[tex]1/{4}[/tex] - 1 .The mean annual growth rate of an investment over a defined time period longer than one year is known as the compound annual growth rate, or CAGR.
What is CAGR?The mean annual growth rate of an investment over a defined time period longer than one year is known as the compound annual growth rate, or CAGR. It stands for one of the most precise techniques to figure out returns for specific assets, investment portfolios, and anything else whose value can change over time.
Text CAGR is calculated as left(frac)V text finalV text beginRight.
^{1/t} - 1 \s\
CAGR stands for compound annual growth rate.
V text begin = initial value = $300,000
V text = the final value = $500,000
T equals time in years = 4 years
Then ( $500,000/300,000)[tex]1/{4}[/tex] - 1
=( $1.67)[tex]1/{4}[/tex] - 1 .
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every year walter travels to china where he legally buys large quantities of baseball caps related to mlb sports teams. he imports the caps back into the united states where he sells them for less than the normal market price at his storefront in new york city. the baseball caps are considered to be .
In this case, the baseball caps are considered to be gray market goods.
What are gray Markets?
A market where unlicensed vendors sell legitimate goods that might have great consumer demand is referred to as a "gray market" or "grey market."In such a market, purchasers or investors put their money to work investing in order to profit above-average returns on the sale of products or securities at a discount.Investors typically work with brokers, issuers, and underwriters in the securities grey market as they try to gauge demand for a company's IPOs or halted stocks.A grey market premium, also known as a GMP, aids individual investors in calculating their gains and losses.To learn more about gray markets:
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lbc corporation makes and sells a product called product wz. each unit of product wz requires 4.3 hours of direct labor at the rate of $22.00 per direct labor-hour. management would like you to prepare a direct labor budget for june. the company plans to sell 26,000 units of product wz in june. the finished goods inventories on june 1 and june 30 are budgeted to be 480 and 60 units, respectively. budgeted direct labor costs for june would be:
What a company pays its employees to produce one unit of output is known as the unit labor cost (ULC).
How do you calculate unit labor cost?Unit labor costs are frequently used as a general indicator of price competitiveness on the global market. They are described as the typical cost of labor for each produced unit of output. The ratio of total labor compensation to output per hour worked can be used to express them.The following chart illustrates how the budgeted direct labor cost per unit was calculated:Budgeted direct labor cost per unit = Required direct labor hours × rate per direct labor hour.
= 4.3 hours × $22
= $94.60
We can determine the budgeted direct labor cost per unit by multiplying the required direct labor hours by the rate per direct labor hour.
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According to the pm essential skills video case, project managment is all about what?.
According to the Project Management Essential skills video case, project management is all about Managing Complex Inter-Linear Relationships.
What is Project Management?Project management is the process of managing a team's effort to fulfill all project goals within the limits set.
This data is often specified in project documentation, which is prepared at the start of the development process. Scope, time, and budget are the key restrictions.
In other words, the objective of project management is to plan and manage a project so that its stated goals and deliverables are met.
It entails detecting and controlling risks, as well as cautious resource management, prudent budgeting, and good communication across numerous teams and stakeholders.
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A fruit stand has to decide what to charge for their produce. They need \$5$5dollar sign, 5 for 111 apple and 111 orange. They also need \$15$15dollar sign, 15 for 333 apples and 333 oranges. Put this information into a system of linear equations. Can we find a unique price for an apple and an orange?.
Then this system of the two-variable linear equations will have an infinite solution.
What is a linear equation?When there is only one variable, there is only one feasible solution. This particular case, in which the variable is accurately referred to as the "unknown," is one to which the term "linear equation" sometimes relates implicitly. The Cartesian coordinates of a point on the Euclidean plane can be used to understand each solution in the scenario with two variables. A linear equation's solutions form a line in the Euclidean plane, and each line can be considered to be the collection of all solutions to a linear equation with two variables. This is how this category of equations came to be known as "linear." In a broader sense, a hyperplane is defined by the solutions to a linear equation in n variables in Euclidean space of dimension n.
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a parcel of land is offered for sale at $600,000, is assessed for tax purposes at $500,000, is recognized by its purchasers as easily being worth $575,000, and is sold for $570,000. at what amount should the land be recorded in the purchaser's books?
A parcel of land is offered for sale at $600,000. Hence, Amount at which the land should be recorded in purchaser's book = $ 570,000
What is the historical cost principle?The historical cost principle is the basic accounting principle under US GAAP. Under the historical cost principle, most assets must be accounted for at cost, even if they have increased significantly in value over time. Not all assets are held at cost.
Why is the historical cost principle important?The historical cost principle is important. This is because companies can track the value of their assets over time, even if the value of the assets changes. This principle helps companies avoid inflating their financial statements by taking advantage of changes in market values.
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after a buyer expresses a price objection, it is inappropriate for the salesperson to ask the buyer probing questions. a.true b.false
After a buyer expresses a price objection, it is inappropriate for the salesperson to ask the buyer probing questions it's true because the reason consumers return goods is generally because they don't fit the size, or don't match expectations.
A buyer is someone who buys certain goods or uses certain services. A seller is someone who sells certain goods or uses certain services.
With the enactment of a return policy system for consumers mandated by the consumer protection law. With this return policy, we can return every item that we have purchased to the store that sold it as long as it is within the specified time. When returning the item, we are not required to provide a reason for returning it, and the money worth the price of the item will be returned in full.
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money's function as a unit of account means that money _________________ .
Answer:
bank
Explanation:
you want to create a portfolio equally as risky as the market, and you have $500,000 to invest. information about the possible investments is given below: asset investment beta stock a $ 145,000 .90 stock b $ 135,000 1.35 stock c 1.50 risk-free asset
Investment in stock C will be $1,221,788.08.
An investment can be described as an asset or goods accrued with the aim of generating income or recognition.
To determine the amount of investment we can use this formula
Portfolio beta = wA x Beta A + wB x Beta B + ... + wN * Beta N
where w is expressed a weight every stock in the portfolio.
Assume investment in stock c be x
Then, it will be:
1 = 146000/500000(0.91) + 134000/500000(1.36) + x/500000 (1.51)
1 = 0.26572 + 0.36448 + 1.51x/500000
1 = 0.6302 + 1.51x/500000
1 - 0.6302 = 1.51x / 500000
0.3698(500000) = 1.51x
1844900 / 1.51 = x
x = 1,221,788.079
If we round the result to two decimal it will be 1,221,788.08
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A company is planning to sell the rights to its brand name for use in other countries. This is an example of a.
A company is planning to sell the rights to its brand name for use in other countries. This is an example of a licensing agreement.
What do you mean by licensing agreement?
Licensing agreement can be defined as a legal, written contract between two parties wherein the property owner can give permission to another party to use their brand, patent, or trademark. Examples include songs, sports team logos, intellectual property, software, and technology.
Parameters to keep in mind during licensing agreement are
Geographical regions within which the property may be utilized.The time period The exclusivity or non-exclusivity of a given arrangement.It helps in saving a lot of time, money, and hassles.
Hence , A company is planning to sell the rights to its brand name for use in other countries. This is an example of a licensing agreement.
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katrine, a sales manager, is keeping the latest sales numbers of her division from her regional director in fear that the poor performance will make the director angry. this is an example of which communication barrier?
Katrine, a sales manager, is keeping the latest sales numbers of her division. This is an example of Filtering communication barrier.
Communication Barriers:
Communication barriers are commodity that prevents us from rightly getting and accepting the dispatches others use to communicate their information, studies and ideas. Some of the exemplifications of communication barriers are information load, choosy comprehensions, plant gossipers, semantics, gender differences,etc.
Why is communication barrier important?By recognising what may be a barrier to communication, we make mindfulness of what might be passing when we communicate with others These and numerous other walls can beget disposition between people and beget misconstructions
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wiggleville pet store received merchandise costing $1,250 on may 5, invoice 1100. some goods were damaged, and the supplier granted a $250 purchase allowance on their credit memo 686 of may 10. wiggleyville will record this allowance with a debit to:
Wigglyville will record this allowance with a debit to Purchases returns and allowances
Account for Credit Memos :
In a dealer's double- entry account system, a credit memo is recorded as a debit under the applicable Revenue account and a credit under Accounts Receivable, which is the accurate contrary of the initial transactions entry as the memo reduces the balance that the dealer is presently owned by the buyer.
Is a credit memo a refund?A credit memo is a document published by a supplier when bought products or requested services aren't delivered, negotiated or are returned by the client. It indicates a credit is owed to the client for the valuation of the replaced or undelivered commodities.
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_______ are moral principles and values that govern the behavior of people, firms, and governments regarding right and wrong.
Ethics are moral principles and values that govern the behavior of people, firms and governments regarding right and wrong.
The study of what is ethically good and bad, as well as right and wrong, is termed ethics. It is sometimes also known as moral philosophy. Any theory or system of moral ideals or principles can also be included under this umbrella phrase. Axiology is a subfield of philosophy that consists of the fields of ethics and aesthetics. These fields are concerned with values. Through the definition of terms like good and evil, right and wrong, virtue and vice, justice and crime, ethics aims to answer concerns about human morality.
The following are the top three recognized areas of research in ethics today:
Meta-ethics: the study of the theoretical significance and framework of moral claims and the evaluation of their veracity.Normative ethics: the study of the methods used in daily life to choose a moral path of conduct.Applied ethics: regarding what a person is required to do in a certain circumstance or field.To learn about morals see:
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last week, all of the employees at the nice night hotel group marched in front of their respective places of employment. they carried signs that said they wanted better wages and better working conditions. which type of labor dispute does this represent?
Picketing type of labor dispute. Picketing is a technique used to boost support for industrial action.
What does picketing mean in the workplace?Picketing is a technique used to boost support for industrial action.It occurs when workers taking part in industrial action gather at their place of employment to raise awareness of their cause.They might accomplish this by informing others or influencing them to refuse to carry out all or part of their job obligations.Employees might put more pressure on their employer to settle the collective bargaining disagreement by picketing.Only when the union is really on strike or the company has legitimately locked out the workers are they permitted to picket.Employees are limited to picketing in the location of the legal job action.To learn more about Picketing refer,
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vince never carries a balance on his credit card. if vince charges $200 on his credit card and he pays his balance in full within the grace period, how much will he pay to clear the charge from his credit card? his credit card has an apr of 18%.
Vince is required to pay $200
A credit card is a revolving account that allows the card owner to expense up to the given limit. Most card issuers will not require full payment at the end of each cycle, instead, a card owner can pay the minimum amount. Note that, there is an interest charge on the open balance.
The grace period is the period between the ending date of a credit card cycle and the due date for the minimum payment. If full payment is processed within the grace period, there is no interest charge. Hence, the required payment will be only $200.
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judy's boutique just paid an annual dividend of $3.43 on its common stock. the firm increases its dividend by 3.65 percent annually. what is the company's cost of equity if the current stock price is $42.76 per share? multiple choice 11.35% 11.02% 11.67% 11.96% 12.38%
The company's cost of equity if the current stock price is $42.76 per share is 11.96%.
It represents the compensation that the market demands in exchange for owning the asset and bearing the risk of ownership.
How to calculate cost of equity?
Cost of equity = (dividends per share / current market value of stock) + growth rate of dividends
Now, let's calculate using the formula to get the answer
= ((3.43*(1+0.0365)/42.76) + 0.0365
= (3.55195 / 42.76) + 0.0365
= 0.11964301
= 11.96% (rounded)
So judy's boutique cost of equity is 11.96%
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If the price elasticity of supply for pickles is 2 and the price of pickles increases by 10 percent, then the quantity supplied of pickles will increase by responses 0. 2% 0. 2% 5% 5% 8% 8% 12% 12% 20%.
Price elasticity of deliver (PES or Es) is a degree utilized in economics to reveal the responsiveness, or elasticity, of the amount furnished of an awesome or carrier to a alternate in its rate or cost. Ans: is 20%.
The required details for Price elasticity of deliver (PES) in given paragraph
PES = % alternate in amount furnished / % alternate in rate
% alternate in amount furnished = % alternate in rate * PES = 10% * 2
= 20%
Thus, the amount furnished will growth through 20%.
Price elasticity of deliver measures the responsiveness to the deliver of an awesome or carrier after a alternate in its marketplace rate. According to simple monetary theory, the deliver of an awesome will growth while its rate rises. Conversely, the deliver of an awesome will lower while its rate decreases. There’s elasticity of call for. This measures how responsive the amount demanded is suffering from a rate alternate. Overall, rate elasticity measures how a whole lot the deliver or call for of a product adjustments primarily based totally on a given alternate in rate.
Elastic approach the product is taken into consideration touchy to rate adjustments. Inelastic approach the product isn't touchy to rate movements.
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