Answer:
The maximum capital budget that is consistent with maintaining the target capital structure is $785,714
Explanation:
The computation of the maximum capital budget is shown below:
= Net income × (debt percentage ÷ equity percentage)
= $550,000 × (30% ÷ 70%)
= $235,714
The net income would be equal to equity i.e $550,000 as it reflect the maximum amount
So, the total and maximum amount of the capital structure would be
= $550,000 + $235,714
= $785,714
I think it is either C or D. I'm not sure which one though. Hope this helped, have a great day! :D
Answer:
They both receive capital to use for growth.
Explanation:
The government received the capital in the form of tax that being paid by the citizens. After collecting the tax income, the government allocated it to make a couple of investments such as building the country's infrastructure, providing aid for people to pursue education, and investing in scientific research/development.
Business on the other hand could receive their capital from either reallocating their profit or receiving capital injection from the investors. They use the capital for growth by reinvesting it to increase the scope of their business operation or putting it under investment accounts.
Answer B: the individual will not be able to sell any of their product.
Answer:
b.extract maximum profits from its investments.
Explanation:
A harvest strategy is when companies reduce the investment they have in a product that is in the end of its life cycle to be able to get the highest profits possible so the investors can get their money. According to this, the answer is that in a declining industry, a company may utilize a harvest strategy and extract maximum profits from its investments.
The other options are not right because in a harvest strategy companies decrease thir investment, they don't go to a new market and as they are trying to get the maximum profit possible, they are not interested in increasing the advertising expenditure.
