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loris [4]
3 years ago
15

Your consultant firm has been hired by Eco Brothers Inc. to help them estimate the cost of common equity. The yield on the firm'

s bonds is 8.75%, and your firm's economists believe that the cost of common can be estimated using a risk premium of 3.85% over a firm's own cost of debt. What is an estimate of the firm's cost of common from reinvested earnings?a. 12.60%b. 13.10%c. 13.63%d. 14.17%e. 14.74%
Business
1 answer:
zloy xaker [14]3 years ago
8 0

Answer:

a. 12.60%

Explanation:

The information given above that can be useful is the Risk Free rate and risk premium to calculation of cost of retained earnings.

We know that the calculation of cost of retained earnings =Cost of retained earnings = Risk Free rate + risk premium  

= 8.75% + 3.85%  

= 12.6%

Therefore the correct answer is a. 12.60%

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Susan recently quit working for a local firm and has yet to find a new job. She knows she can maintain her health insurance from
PtichkaEL [24]

Answer:

Susan will have to pay $525 for her health insurance.

Explanation:

The total amount paid to the health insurance is $200 by Susan and $325 by the employer which summed up to $525.

As now the employer is no longer paying the amount for the health insurance, so now Susan has to pay $525 herself for the health insurance.

7 0
3 years ago
the u.s. internal revenue service taxes the taxable income of corporations as well as the taxable investment income of the firms
Tresset [83]

The US internal revenue service taxes the taxable income of corporations as well as the taxable investment income of the firms’ shareholders' double taxation of dividends.

Revenue is the entire quantity of income generated by means of the sale of products or services related to the organization's number one operations. Revenue, additionally known as gross income, is regularly known as the "top line" as it sits at the pinnacle of the income declaration. Profits, or net earnings, are an agency's general profits or income.

In accounting, revenue is the entire quantity of profits generated by using the sale of goods and services related to the primary operations of the business. commercial sales will also be known as income or as turnover. Some corporations get hold of sales from interest, royalties, or different expenses.

Whilst comparing sales vs income you have to understand that “sales” refers to the total amount of cash a company generates before getting rid of any fees. “income”, then again, is equal to sales minus the fees of doing commercial enterprise, which include depreciation, hobby, taxes, and other expenses.

Learn more about revenue here brainly.com/question/16232387

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8 0
1 year ago
If the average propensity to consume is 0.75, and the marginal propensity to consume is 0.70, if income rises by $4,000, consump
LUCKY_DIMON [66]

Answer:

$2,800

Explanation:

The computation of the increase in consumption is shown below:

= Marginal propensity to consume × rise in income

= 0.70 × $4,000

= $2,800

Hence, the consumption would be increased by $2,800

We simply applied the above formula i.e. marginal propensity to consume is multiplied with the rise in income so that the correct answer could come

7 0
3 years ago
Hot Wok Cuisine is a premium Asian restaurant chain that differentiates itself from a large number of competitors by providing e
aleksley [76]

Answer:

monopolistically competitive industry.

Explanation:

this Asian restaurant is likely operating a monopolistically competitive industry. This kind of market structure is a combination of monopoly and competitive market. as it offers products and services which one similar. Also the question says that it has some barriers to entry, which is a characteristic of monopolistically competitive industry. Also goods are similar but not differentiated

5 0
4 years ago
When can a bank repossess someone's car?
Marysya12 [62]

Answer:

A. when the owner defaults on the loan payment

6 0
2 years ago
Read 2 more answers
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