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2 years ago

A comparison between actual and projected expenditures is called.

Business

1 answer:

jeyben [28]2 years ago

7 0

Answer:

variance analysis

Explanation:

a comparison between actual and projected expenditures is called variance analysis

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A stock has an expected return of 10.45 percent, its beta is .93, and the risk-free rate is 3.6 percent. What must the expected

sasho [114]

Answer:

Expected market return will be 10.97%

Explanation:

CAPM is method to calculates the expected return value using beta of the investment risk free rate and market premium of that investment.

According to CAPM

Expected Return Rate = Risdt free rate + Beta ( Market risk Premium)

Expected Return Rate = Risdt free rate + Beta ( Market Return - Risk free rate)

10.45% = 3.6% + 0.93 ( Market return - 3.6%)

10.45 - 3.60 = 0.93 ( Market return - 3.6%)

6.85 / 0.93 = Market return - 3.6%

7.37 + 3.60 = Market return

Market Return = 10.97%

8 0

3 years ago

ou are valuing a company that is projected to generate a free cash flow of $10 million next year, growing at a stable 3.0% rate

mafiozo [28]

Answer:

Each share worth is $2.59

Explanation:

According to the given data we have the following:

D1 = Cash Flow at the end of year 1 = $ 10 million

r = Cost of Capital = 10% = 0.1

g = perpetual growth of cash flows

Hence, The present value of Cash Flows = D1/(r-g)

= 10/(0.1-0.03)

=10/0.07

= $ 142.8571428571 million

= $ 142.86 million

To find the equity value we need to remove the net debt from cash flows

Net Debt = Debt - Cash

= 22 - 8.5

= $ 13.5 million

Now net cash flows = Cash Flows - Net Debt

= 142.86 - 13.5

= $ 129.36 million

Therefore, each share worth = Present Value of Cash Flow / No of Outstanding Shares

= 129.36 / 50 (Both values are in millions so the zeros are ignored)

= 2.5872

= $2.59

Each share worth is $2.59

3 0

3 years ago

How is Comparative Advantage

Mnenie [13.5K]

A the quality of a single good

5 0

2 years ago

A machine that cost $36,000 and on which $26,500 of depreciation had been recorded was disposed of for $10,200. Indicate whether

ad-work [718]

Answer:

The Gain of $700.

Explanation:

For the computation of gain or loss first we need to find out the book value which is shown below:-

Book value = Purchase cost - Accumulated Depreciation

= $36,000 - $26,500 = $9500

Gain or Loss = Selling Price - Book Value

= $10,200 - $9500

= $700

So, there is a

The Gain of $700 as selling price is more than the book value

Therefore for computing the gain or loss we simply applied the above formula.

8 0

3 years ago

Nielson Motors is considering an opportunity that requires an investment of $1,000,000 today and will provide $250,000 one yea

vredina [299]

Answer:

The correct answer is B.

Explanation:

Giving the following information:

Nielson Motors is considering an opportunity that requires an investment of $1,000,000 today and will provide $250,000 one year from now, $450,000 two years from now, and $650,000 three years from now.

The appropriate interest rate is 10%.

We need to calculate the net present value using the following formula:

NPV= -Io + ∑[Cf/(1+i)^n]

Cf= cash flow

Cf1= 250,000/1.10= 227,272.73

Cf2= 450,000/1.10^2= 371,900.83

Cf3= 650,000/1.10^3= 488,354.62

NPV= -1,000,000 + 1,087,528.18= 87,528.18

If the NPV is positive, the investment increases the value of the company.

3 0

3 years ago