Answer:
B) 9.1%
Explanation:
Cost of debt is the interest rate paid by a company due to borrowing money; i.e debt from investors.
$185million in debt is the face value of debt that Westford Corporation had and the $26 million dollars of interest expense is the cost of the debt in dollars;
First, find pretax cost of debt ;
Pretax cost of debt = (Interest expense / Face value of debt )*100
= (26,000,000/ 185,000,000 )*100
=0.1405 *100
= 14.05%
Next, use pretax cost of debt to find after-tax cost of debt;
After-tax cost of debt = Pretax cost of debt (1-tax)
= 14.05% *(1-0.35)
= 9.13%
Therefore, Westford's cost of debt capital is 9.1%
Answer:
<u>D. Happenstance.</u>
Explanation:
The fact that German firms were nationalized has often been regarded as mere happenstance; meaning it just occurred based on the circumstances they were in immediately after World War II.
It thus encompasses several factors such as the cost of operations, changes in government, etc, not just one factor.
Answer:
B) Millcorp has a lawful innocent acquisition of a monopoly.
Answer: C. it's a good time to buy the wood.
Explanation:
$500 = 738NZ dollars, therefore 738 NZ dollar ÷ $500 = 1.476NZ dollar
The current exchange rate is $1 = 1.476NZ dollar
10 foot slab costs $5000, Tee Golf Resort will pay $ 3387.53 ($5000/1.476NZ)
if they import wood from New Zealand. Tee Golf Resort will pay less than $5000 if they import Wood from New Zealand at the current exchange rate. This is a Good time for them to import woods
