Answer:
a tax-rate for 33.33% will make both investment yield an equal return after-taxes
Explanation:
the municipal bonds aare tax free, while the J and K Corp.'s bond are subject to tax income.
threfore to be indifferent between these bonsd the tax rate will equal the corp bon rate after taxes with the municipal bond:
pretax x (1 - t ) = after tax
0.195 x (1-t) = 0.13
1 - 0.13/0.195 = t
t = 1/3 = 33.33%
Below are the three different ways decision makers might select projects while considering both<span> financial and non-financial factors:
1. Financial analysis can be the main strategy for choosing ventures.
2. Financial analysis can be a screening gadget to qualify potential undertakings for thought utilizing a scoring model to settle on determination choices.
3. Financial analysis can be one factor in a multi-factor scoring model used to choose ventures</span>
The correct question is:
Analysts who follow Howe Industries recently noted that, relative to the previous year, the company's net cash provided from operations increased, yet cash as reported on the balance sheet decreased. Which of the following factors could explain this situation?
Select one:
a. The company cut its dividend.
b. The company made large investments in fixed assets.
c. The company sold a division and received cash in return.
d. The company issued new common stock.
e. The company issued new long-term debt.
Answer:
b. The company made large investments in fixed assets.
Explanation:
The operating cash if invested in fixed assets will increase cash flow in the business. Since the cash is not used in production within that period (was invested in long term asset), it will not be represented as cash flow for this period. So reported cash will be low.
Companies invest in long term assets that will produce returns in to future, so cash flow from this investment will appear at a future date.
Answer:
Some sellers can set prices
Explanation:
Characteristics of competitive firms:
1. All sellers are price takers. No seller can influence market price.
2. All buyers are price takers
3. Forces of demand and supply determine market price.
4. All products are homogenous
5. There are no barriers to entry or exist of firms
6. There is perfect information
