Answer:
The correct answer is $1,836,742.42.
Explanation:
According to the scenario, the given data are as follows:
EBIT = $373,000
Cost of equity = 13.2%
Tax rate = 35%
So, we can calculate the unlevered value of the firm by using following formula:
Unlevered value of the firm = EBIT × (1 - TAX RATE) ÷ COST OF EQUITY
By putting the value, we get
Unlevered value of the firm = $373,000 × ( 1 - 35%) ÷ 13.2%
= $373,000 × 0.65 ÷ 0.132
= $242,450 ÷ 0.132
= $1,836,742.42
If a government is trying to encourage economic growth, they would do all of these things except raise taxes. Raising taxes has the opposite effect and will slow growth because it takes more money out of the economy that could be used for growth and expansion.
Answer: 15%
Explanation:
IRR is the discount rate that makes the NPV equal zero. Required rates of return that are less than the IRR will therefore result in a positive NPV and those that are higher will result in a negative NPV.
Use Excel to find the IRR.
= IRR(-328325,115000,115000,115000,115000)
= 15%
As the required rate of 13% is less than the IRR of 15%, the new machine will have a positive NPV.
Answer:
Steak is a normal good, and hamburger is an inferior good for Jennie
Explanation:
Based on this behavior, we can assume steak is a normal good, and hamburger is an inferior good for Jennie. That is because a normal good is any good who's demand increases when there is a rise in the consumers' income, while an inferior good sees decreased demand due to a rise in income. Therefore, since Jenna buys more (increased demand) steak and less (decreased demand) hamburger due to her increased income this means that steak is a normal good, and hamburger is an inferior good for Jennie
Answer:b
Explanation:
if you show that other companies profit from what you sell people would want to by the product
E.6.C
