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kirza4 [7]
3 years ago
8

Duval Inc. uses only equity capital, and it has two equally-sized divisions. Division A's cost of capital is 10.0%, Division B's

cost is 14.0%, and the corporate (composite) WACC is 12.0%. All of Division A's projects are equally risky, as are all of Division B's projects. However, the projects of Division A are less risky than those of Division B. Which of the following projects should the firm accept? A Division B project with a 13% return. A Division B project with a 12% return. A Division A project with an 11% return. A Division A project with a 9% return. A Division B project with an 11% return.
Business
1 answer:
saveliy_v [14]3 years ago
4 0

Answer:

A Division A project with an 11%

Explanation:

The project should be analize with the cost of capital for each division, as it is a know values it is a better choise than WACC.

For that reason, going for project of less than 14% (13% or 11%) in division b will be destroying capital

While the project in Division A for 11% means it will generate economic value to the firm as the cost is 10% and return 11%

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Briefly explain how the government uses taxation as a redistribution method
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The purpose of this is to increase economic stability.

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When you buy in bulk, the price per individual item .
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Decreases

Explanation:

The seller is willing to diminsh price if he can sell more units of anygiven product.

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3 years ago
A watch manufacturer incurs a variable cost of $10 per watch and fixed costs of $400,000. To earn a 25 percent markup on selling
WITCHER [35]

Answer:

$22.50 per unit

Explanation:

Mark -up is the percentage of cost that is earned as profit.

Using mark-up,

Selling price = Total cost + total profit

Total cot = Fixed cost + variable cost

Total costs = $400,000 +  (10× 50,000)

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Sales revenue = 125%× 900,000

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Selling price per unit = Sales revenue/units

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                     = $22.50 per unit

6 0
3 years ago
Read 2 more answers
If the natural rate of unemployment _____, the nonaccelerating inflation rate of unemployment _____, and the long-run phillips c
11Alexandr11 [23.1K]

If the natural rate of unemployment falls, the nonaccelerating inflation rate of unemployment falls, and the long-run Phillips curve shifts to the right.

A superb supply stock or a boom in combination supply will cause the Phillips curve to shift to the left. moreover, something that can purpose the overall delivery of products and offerings to increase can shift the Phillips curve to the left. The Phillips curve states that inflation and unemployment have an inverse relationship. higher inflation is associated with decreased unemployment and vice versa.

The Phillips curve was a concept used for manual macroeconomic policy inside the 20th century however become called into question by the stagflation of the 1970s. according to the NAIRU concept, expansionary financial policies will create the best temporary decreases in unemployment as the financial system will regulate the natural fee. moreover whilst unemployment is below the natural fee inflation will accelerate.

Learn more about Phillips curve here:-brainly.com/question/28005556

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5 0
1 year ago
A flood damaged several vans belonging to a nongovernmental, not-for-profit organization. A professional mechanic repaired the v
Westkost [7]

Answer:

b. As both an increase in the equipment account and an increase in contributions from donated services.

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When the flood damages the vehicles there was a loss in the value of the organisation's equipment. The actor of restoring it to its previous state will require an addition to equipment account. So there will be an increase in equipment.

The services provided by the mechanic were free and will be recorded as a donated service. This is an increase in contributions from donated services.

There is no expense recorded as the services were performed for free.

5 0
3 years ago
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