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Leto [7]
3 years ago
9

The capital allocation process involves the transfer of capital among different entities that include individuals, small busines

ses, banks, financial intermediaries, companies, mutual funds, and other market participants. In a developed market economy, capital flows freely between entities that want to supply capital to those who want it. This flow of capital can be classified in three ways. In the table below, identify the nature of capital transfer given in the scenario with its appropriate classification:(a) Elliot invests $25,000 by purchasing 1,000 shares of an emerging markets mutual fund. This mutual fund invests in companies in Brazil, India, and China. He bought the mutual fund from the mutual fund company.(b) Based in Grass Valley, California, L & M Seeds Co. is a small company that manufactures organic seeds. To raise capital, the company sells stocks directly to savers in Grass Valley without involving any bank or financial intermediary.(c) xEdu.com is an early-stage start-up company that plans to issue its first public common stock—called an initial public offering (IPO)—in six months. It hires an investment bank to underwrite the issue.(d) Erin borrows money from her uncle to buy a new laptop.
Business
1 answer:
Zolol [24]3 years ago
8 0

Answer:

We have to classify the transfers as Direct Transfer, Indirect Transfer Through Investment Banks, and Indirect Transfer Through Financial Intermediaries.

(a) - Indirect Transfer Through Financial Intermediaries.

A market mutual fund is a financial intermediary, and it is the option that Elliot has chosen to transfer capital.

(b) - Direct Transfer

As the statement explains, the company has not gone through any financial intermediation to raise capital. It has directly done so.

(c) - Indirect Transfer Through Investment Banks

xEdu.com hired an an investment banking to issue its initial public offering

(d) - Direct Transfer

Erin borrowed the money from his uncle without any financial intermediation.

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This strategy will help Cedric to answer the questions while doing the final writing in answer sheet. By doing this he can also improve his speed with accuracy while answering.

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Gary Downs recently has noticed that the plant he is managing is delivering only 30 percent of its products on time. To determin
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c. democratic

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Read 2 more answers
Kim thinks that she is going to love working for her new company, as it is very informal with a lot of cross-functional teams wi
alisha [4.7K]

Answer:

Organic

Explanation:

An organic structure in a company has an extremely flat reporting structure. Employees tend to interact among themselves and not along different management levels or direct reports.

This structure affects decision making which is more by consensus. Decision does not lie with a single manager.

In the given scenario the organisation where Kim wants to work is very informal with a lot of cross-functional teams with members from different departments.

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2 years ago
A delivery service is buying 600 tires for its fleet of vehicles. One supplier offers to supply the tires for $80 per tire, paya
Serhud [2]

Answer:

$-573.54

Explanation:

Present value is the sum of discounted cash flows.

Present value can be found using a financial calculator.

For the first supplier

Cash flow in year zero = 0

Cash flow in year 1 = $80 x 600 = $48,000

I = 8.1%

Present value = $44,403.33

For the second supplier,

Cash flow in year zero = $20,000

Cash flow in year one = $45 × 600 = $27,000

I = 8.1%

Present value =$44,976.87

Difference = $44,403.33 -44,976.87 = $-573.54

To find the PV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

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