What is the total cost for an item that costs $140.00 and has a sales tax rate of 7.5%?

When oil prices go up, we tend to see less investment by consumers in _____________________.

balu736 [363]

Larger vehicles with larger motors because they use oil whereas electric cars run on electricity,biofuels refers to oils if people invest to extract it they can earn money,solar energy is free and doesn’t require anything. Hence, people tend to spend less on larger machines with larger motors.

7 0

3 years ago

Read 2 more answers

Colgate-Palmolive Company reports the following balances in its retained earnings.

Dafna11 [192]

Answer:

a. $1,028 million

b. 46.7%

Explanation:

a. Dividends are taken from the retained earnings and net income is added to the retained earnings. The formula for ending retained earnings is;

Ending retained earnings = Opening Retained earnings + Net Income - Dividends

14,329 = 13,157 + 2,200 - Dividends

Dividends = 13,157 + 2,200 - 14,329

Dividends = $1,028 million

b. Dividends as a percentage of income

= 1,028/2,200

= 0.467

= 46.7%

3 0

3 years ago

Margarite's Enterprises is considering a new project that will require $345,000 for new fixed assets, $160,000 for inventory, an

atroni [7]

Answer:

NPV = (53,222.44)

Explanation:

Net fixed asset 345,000

Working capital

160,000 inventory + 35,000 Ar = 195,000

short term deb (110,000)

net working capital 85,000

Total investment 430,000

salvage value 345,00 x 25% = 86,250

release of the working capital 85,000

Cash flow at end of project 171,250

annual cash flow

sales 550,000

cost (430,000)

depreciation 69,000

EBT 51,000

tax expense 35%

(17,850)

net income 33,150

+ dep 69,000

cash flow 102,150

Now we calculate the present value of the net cash flow and the present alue fothe end of the project

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 102150

time 4

rate 0.15

$102150 \times \frac{1-(1+0.15)^{-4} }{0.15} = PV\\$

PV $291,636.04

$\frac{Principal}{(1 + rate)^{time} } = PV$

Principla (sum of salvage and released Working capital 171,250.00

time 5.00

rate 0.15

$\frac{171250}{(1 + 0.15)^{5} } = PV$

PV 85,141.52

NPV = 291,636.04 + 85,141.52 - 430,000 = (53,222.44)

6 0

4 years ago

Use the expenditure multiplier to calculate the change in AD that would result from a $100 million increase in government spendi

adelina 88 [10]

Answer:

If MPC is 0.8, Change in GDP = $500 million

If MPC is 0.95, Change in GDP = $2,000 million

Explanation:

Expenditure Multiplier is the amount by which the real GDP will change if autonomous expenditure changes by a given amount.

It is calculated as follows: 1/(1-MPC).

MPC is the portion of additional income that is spent. If the MPC is 0.8, then the expenditure multiplier will be = 1/(1-0.8) = 5

Using the first scenario with an increase in government spending by $100million, the resulting change in GDP would be

Change in GDP = change in autonomous expenditure × Multiplier

= 100 × 5 = $500 million

Scenario 2, MPC of 0.95

Expenditure Multiplier = 1/(1-0.95) = 20

Change in GDP= 100 × 20 = $2000 million

6 0

3 years ago

LUVFINANCE, Inc. is estimating its WACC. It is operating at its optimal capital structure. Its outstanding bonds have a 12 perce

11111nata11111 [884]

Answer:

9.72%

Explanation:

Maturity = 34

Par-value = -1000

Coupon rate = 6%

Coupon PMT = -60

Value of bond = 1152

Semi-annual Yield = Rate(34, -60, 1162, -1000, 0, 0)

Semi-annual Yield = 5.00%

Annual Yield = 10%

Tax rate = 40%

After tax cost of debt = 10*(1-0.4)= 6%: Add: Flotation cost (5%) = 11%

Cost of preferred stock = Dividend/Price = 12/120 = 10%

Cost of equity = Risk free rate + Beta*Market risk premium

Cost of equity = 3.72 + 0.94*6

Cost of equity = 9.36%

Particulars Value per No of Market Weight Cost of Product

security securities value security

Bonds 1162 100000 116200000 0.15784 11 1.736213

P. stock 120 1000000 120000000 0.16299 10 1.62999

Equity 100 5000000 500000000 0.6792 9.36 6.35697

736200000 1 9.72317

So, the WACC of the firm is 9.72%

3 0

3 years ago