Answer:
The answer is D. All of the above
Explanation:
The Capital structure of most companies comprise equity, debt and/or preference shares. All these that made up capital structure has cost or let's say return. We have cost of capital, cost of debt, cost of preference shares.
Therefore, weighted average cost of capital is average of the cost of each financing component(cost of capital, cost of debt and cost of preference shares), weighted by the proportion of each component
All the options relates to the weighted average cost of capital(WACC).
Answer:
B
Explanation:
This is a dominant business strategy. As a dominant business, operations starts in one major industry and then the firm expands by purchasing businesses or creating new firms.
UPS has a dominant strategy because of the different business segments in the firm. 61 percent from U.S. package delivery operations, 22 percent from international package delivery, and 17 percent from non-packaging operations.
Personal finance<span> is the organizing your finances and making logical monetary decisions.</span><span> to the monetary decisions of an individual or family unit. It includes planning on your budget, savings, spending, resources, and wage. You must be careful with these decisions for future events and accidents can change plans.</span>
Answer:
3-month real rate: 1.56%
30 years real rate: 4.42%
Explanation:
We will calcualte the future value of the bond and adjust by inflation:
3.months TB:
Principal 100.00
time 1 quarter
rate 0.01085 (4.34% divide into 4 quarter)
Amount 101.09
Adjusted for 2.78 annual inflation
Nominal 101.09
time 1 quarter
Inflation 0.0278/4 = 0,00695
PV 100.39
100.39 / 100 - 1 = 0.39% quarterly rate:
0.39 x 4 = 1.56% real rate.
Because the time is low and difference in rate is lower there is no subtancial difference between the accurate method and the simplier method : nominal - inflation = 4.34 - 2.78 = 1.56
Now we do the same for the 30 years TB
Principal 100.00
time 30.00
rate 0.07330
Amount 834.90
Maturity 834.90
time 30.00
rate 0.0278
PV 366.75
now we calculate the rate:
30√366.75/100 - 1 = 0.04427 = 4.42%