Answer:
The cross price elasticity of salsa and guacamole is 0.2. The two goods are substitutes.
Explanation:
The price of guacamole is increased from $2 to $2.5.
Percentage change in price
= 
= 
= 25%
The demand for salsa rises by 5%.
The cross price elasticity will be
= 
= 
= 0.2
We see that the cross price elasticity is positive. This means that the two goods are substitutes. When price of one good will increase consumers will prefer the cheaper substitute, increasing its demand.
Answer:
According to Given Data
$1,444
According to attached question
C.$4,181
Explanation:
Options are inconsistent with the data provided.
Net present value is the Net value all cash inflows and outflows in present value term. All the cash flows are discounted using a required rate of return.
Ne t present value of the machine is $1,444
Options are inconsistent with the data provided.
Workings are made in an MS Excel file, which is attached with this answer.
Original Question is attached with this answer, please find it.
According to correct data
Ne t present value of the machine is $4,181
Answer:
The company's current stock price is $ 18.62.
Explanation:
To calculate the company's current stock price we have to use first the following formula to calculate the: Expected Return of stock
Expected Return of stock = Risk Free Rate+ Beta * Market Risk Premium
Expected Return of stock= 4+1.15*5
=4+5.75
Expected Return = 9.75%
Then, we can calculate the stock price with the following formula:
Price = Dividendat year 1/ Return- Growth
D1 =0.75*105.5%
=0.79125
Price =0.79/( 0.0975-0.055)
=18.62
The price is $ 18.62
Answer:
The correct answer is letter "D": a hugely untapped market segment.
Explanation:
The Bottom of the Pyramid (BOP), sometimes called the base of the pyramid, represents the biggest sector of the economic human pyramid. In the BOP there is an approximate of billion people living in extreme poverty. Corporate Social Responsibility (CSR) which involves companies' activities to match their objectives with society's goals, has in the BOP a lot of fields to discover and contribute.
Answer:
31.5%
Explanation:
Given from the question kd = 7.0 %
Tax rate = 35 %
P0 = $ 28.86
Growth g = 4.9 %
D1 = $ 0.94
First find the cost of common stock by
rS = D1/P0 + g
=0.94/$28.86 + 0.49
=0.523
= 52.3%
Finally, calculate the weighted average cost of capital WACC,
using rs= 0.523,
Tax rate =43% =0.43
Equity E 100% - 43% = 57% =0.57 and
kd=7.0 % = 0.07
so WACC = (D/A)(1 - Tax rate)kd+(E/A)rs
= 0.43(1 - 0.43)(0.07) + 0.57(0.523)
0.0172 + 0.298
= 0.315
= 31.5%
