Answer:
<h2>The correct answers in this case are options (ii) and (iii).</h2>
Explanation:
As opposed to competitive market structure,the Marginal Revenue(MR) for a monopoly is less than the output price(P).In competitive market,the market competition or firm rivalry pushes the price down to a fixed level which is equal to MR or the revenue earned by all firms(price takers) from selling 1 more unit of output.Due to absence of any competition,a monopoly(price maker) can set the P and production level at the point where MR is equal to the Marginal Cost of production(MC) or the cost of producing one more unit of output.This is the profit maximizing price and output of a monopoly.Now,to sell more output,the monopoly has to increasingly reduce the P in order to attract more customers and it will continually set the P at the profit maximizing level of output where MR=MC.Therefore,for a monopoly,the P or output price is less than the MR obtained,while due to high competition or firm rivalry,all the competitive firms are able to charge a fixed and uniform P for each unit of output and earn identical MR as well.
Answer:
C. changes both the supply of and demand for loanable funds.
Explanation:
A budget deficit is when expenses exceed revenue and denotes the financial capability of a country.
In the presence of a deficit, the demand for loanable funds will increase because the government moves towards lending money. Deficits decrease the supply of loanable funds while surpluses increase the supply of loanable funds. So, both supply and demand of loanable funds are affected by budget deficit.
This is a passive investment strategy meaning that she is not actively trading her stocks. This type of strategy is usually tied to an index fund or strategy that rises and falls with the overall market.
Perseverance. All start-up businesses face many problems.
Self-confidence. This must be unshakeable even when faced with failure.
Initiative.
Internal Locus of Control.
Tolerance of Ambiguity.
Low fear of failure.
Answer:
a. 4.94%
b. 11.48%
Explanation:
Here in this question, we are interested in calculating the pretax cost of debt and cost of equity.
We proceed as follows;
a. From the question;
The debt equity ratio = 1.15
since Equity = 1 ; Then
Total debt + Total equity = 1 + 1.15 = 2.15
Mathematically ;
WACC = Cost of equity x Weight of equity + Pretax Cost of debt x Weight of debt x (1-Tax rate)
Where WACC = 8.6%
Cost of equity = 14%
Weight of equity = 1/(total debt + total equity) = 1/(1+1.15) = 1/2.15
Pretax cost of debt = ?
Weight of debt = debt equity ratio/total cost of debt = 1.15/2.15
Tax rate = 21% = 0.21
Substituting these values, we have;
8.6% = 14% x 1/2.15 + Pretax cost of debt x 1.15/2.15 x (1-21%)
8.6% = 14% x 1/2.15 + Pretax cost of debt x 1.15/2.15 x (1-21%)
Pretax cost debt = (8.6%-6.511628%)/(1.15/2.15 x (1-21%))
Pretax cost of debt = 4.94%
b. WACC = Cost of equity x Weight of equity + After tax Cost of debt x Weight of debt
8.6% = Cost of equity x 1/2.15 + 6.1% x 1.15/2.15
Cost of equity = (8.6%-3.26279%)/(1/2.15)
Cost of equity = 11.48%