Answer:
12,552 shares
Explanation:
Data provided:
Initial outstanding shares of the firm = 16,000 shares
Value of each share = $14.50
Debt issued = $50,000
Now,
the number of shares used for issuing for $50,000 debt
= Debt issued / value of each share
on substituting the respective values, we have
the number of shares used for issuing for $50,000 debt
= $50,000 / $14.50
= 3448.27 ≈ 3448 shares
Now,
The shares of stock that are outstanding once the debt is issued =
= Initial outstanding shares - shares used for issuing for $50,000 debt
= 16,000 - 3448
= 12,552 shares
Answer:B) $28,980.
Explanation:
Beginning inventory is 6,000 ounces
Closing inventory = 8,200 × 3 ounces × 25% = 6,150ounces
Budgeted production = 8,000 × 3 ounces=24,000
Direct material to be purchased = Closing inventory + Budgeted production - Beginning inventory= 29,400 ounces
Direct material to be purchased = 6,150ounces +24,000- 6,000 ounces
= 24,150 ounces
Now,For $1.20 per pounce, it would be
= 24,150 ounces × $1.20
= $28,980.
Answer: A
Explanation:
A complementary good is a product that is used together with another product. Without its complement, such a good will have little value. When there is increase in the price of a particular product, the demand of its complement reduces because consumers may not be able to use the complement on its own.
Complements have negative cross elasticity of demand i.e there is increase in the demand for a product when the price of its complement reduces. If bicycles and gasoline are complements, an increase in tax on gasoline will have a negative effect on the demand for bicycle. Due to the price increase of gasoline, less people will demand for bicycle. The initial change that will occur as a result of this is that as there is a price increase for gasoline, there will be a leftward shift in the demand for bicycle. This implies that less bicycle will be demanded for.
Answer:
answer is A) $206 B) $61.31
Explanation:
to calculate price of the stock at zero we use dividend discount model formula
P0= D(1+G)/(r-g)
10(1.03)/(0.08-0.03)
$206
b) The dividend is said to be 2% of the free cash flow therefore can be calculated as $10*0.2=$2 per share
then calculate divide growth rates
D1=2*1.3 =2.6
D2=2*(1.3)(1.3)=3.38
D3 = 2*(1.3)(1.3)(1.3)=4.394
Claculate the discount rate using CAPM according to given information
R= 0.2+ 1.5(0.08-0.02)
= 0.11/11%
Use the dividend discount model to calculate the price of the stock
P0= 2.6/1.11+3.38/1.3²+4.394*(1.05)/(0.11-0.05)
2.342+2.743+56.225
=$61.31
Answer: Option (C)
Explanation:
Mortgage-backed security is referred to as an investment which is quite similar to the bond that is formed from the accumulation of home loan which are bought from several commercial banks. The investors indulged in the Mortgage Based Security tend to earn a periodic payment which are similar to the bond coupon. These securities are often referred to as the conduits.
