Answer:
WACC = 0.16637 OR 16.637%
Explanation:
WACC or weighted average cost of capital is the cost of a firm's capital structure which can comprise of debt, preferred stock and common equity. The WACC for a firm with only debt and common equity can be calculated as follows,
WACC = wD * rD * (1-tax rate) + wE * rE
Where,
- w represents the weight of each component based on market value in the capital structure
- r represents the cost of each component
- D and E represents debt and equity respectively
To calculate WACC, we first need to calculate the Market value an cost of equity.
The market value of equity = 30 million shares * $40 per share
MV of equity = $1200 million
The cost of equity can be found using the formula for Price today (P0) under constant growth model of DDM.
P0 = D1 / (r - g)
40 = 4 / (r - 0.07)
40 * (r - 0.07) = 4
40r - 2.8 = 4
40r = 4+2.8
r = 6.8 / 40
r = 0.17 or 17%
MV of debt = 40 million * 96.5% => $38.6 million
Total MV of capital structure = 38.6 + 1200 = 1238.6 million
WACC = 38.6/1238.6 * 0.08 * (1-0.33) + 1200/1238.6 * 0.17
WACC = 0.16637 OR 16.637%
Answer:
<h2>Price is determined by the</h2><h2> intersection of market demand and market supply; individual firms do not have any influence on the market price in perfect competition. Once the market price has been determined by market supply and demand forces, individual firms become price takers.</h2>
Explanation:
<h2>
<em><u>PLEASE</u></em><em><u> MARK</u></em><em><u> ME</u></em><em><u> BRAINLIEST</u></em><em><u> AND</u></em><em><u> FOLLOW</u></em><em><u> ME</u></em><em><u> LOTS</u></em><em><u> OF</u></em><em><u> LOVE</u></em><em><u> FROM</u></em><em><u> MY</u></em><em><u> HEART</u></em><em><u> AND</u></em><em><u> SOUL</u></em><em><u> DARLING</u></em><em><u> TEJASWINI</u></em><em><u> SINHA</u></em><em><u> HERE</u></em><em><u> ❤️</u></em></h2>
Answer:
$319,000
Explanation:
The computation of the liability is shown below:
= Total expenses in three year - actual warranty expenditure
where,
Total expenses in three years = Total sales × total percentage of sales
= $6,200,000 × 9%
= $558,000
And, the actual warranty expenditure is $239,000
Now put these values to the above formula
So, the value would equal to
= $558,000 - $239,000
= $319,000
Answer:
Estimated as Elastic Demand
Explanation:
Elastic demand is where a change in price causes a significant change in demand, therefore 20 hats to 15 hats can be considered significant and we can conclude that it's elastic demand.
Answer: a decrease in U.S. next exports and increase in U.S. investment
Explanation:
Net export is the measure of a country's total trade. Net exports can be calculated by subtracting the value of all goods and services a county imports from the value of the total goods and services the country exports.
When exports reduce and imports increase, then the net exports (exports ‐ imports) will reduce. Since the U.S. company buys a new industrial sewing machine from a company that is located in France, this means that the U.S net export will decrease.
The sewing machine can be used for the production of cloth. This will lead.to an increase in investment.
