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3 years ago

B) Answer the following questions.

Business

1 answer:

lana [24]3 years ago

6 0

Answer:

Yes, agree, business transactions are economic transactions. Two reasons why:

Profit motive: economic transactions have a profit motive: they are carried out and agreed upon between the two parties, because the parties feel that they will be better off after the transaction is completed. Business transactions are based on the profit motive.
Things of value: goods and/or services, are exchanged between the parties. In business transactions, either a good (for example, an asset), or a service (for example, employees), is always exchanged.

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The manager of a retail store notices that 7% of the inventory is missing. She doesn’t know if the merchandise was stolen, lost,

hodyreva [135]

Answer:

<u>(D) inventory obsolescence</u>

Explanation:

It is known as the phase where the inventory is at the end or final stage of its product cycle. This inventory can be sold or used for the long run and is then not expected or liable to be given or sold in the future by the company.

As she doesn't know whether the inventory is missing or does not know if it has been broken or stolen, she can note this down and thus can asset for the criteria following the valid integrity testing.

8 0

3 years ago

The more ________ used, the greater the leverage a company employs on behalf of its owners.

son4ous [18]

The more debt used, the greater the leverage a company employs on behalf of its owners.

<h3>What is financial leverage?</h3>

Financial leverage exists as the usage of borrowed money (debt) to finance the purchase of assets with the anticipation that the income or capital gain from the new asset will surpass the cost of borrowing.

<h3>What is financial leverage example?</h3>

An example of financial leverage use contains utilizing debt to buy a house, borrowing money from the bank to begin a store, and bonds issued by companies.

Debt exists as an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another group, the creditor. Debt stands for deferred payment, or sequence of payments, which distinguishes it from an immediate purchase.

To learn more about financial leverage refer to:

brainly.com/question/17099821

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8 0

1 year ago

The Allied Group is considering two investments. The first investment involves a packaging machine, which can be used to package

Lemur [1.5K]

Answer:

1. Calculate each project's payback period.

Payback period packaging machine = the positive cash flows are lower than the initial outlay

Payback period molding machine = 4.45 years

2. Calculate the NPV for each project.

Using a financial calculator

NPV for packaging machine = -$4,178.24

NPV for molding machine = -$2,907.50

3. Calculate the IRR for each project.

IRR for packaging machine = -0.86%

IRR for molding machine = 3.5%

4. If the two projects are independent of each other, which projects, if any, should be selected? Explain why or why not.

None should be selected since the NPVs are negative

5. If the two projects are mutually exclusive, which project, if any, should be selected? Explain why.

None should be selected since the NPVs are negative

3 0

3 years ago

The stock of Big Joe's has a beta of 1.64 and an expected return of 13.30 percent. The risk-free rate of return is 5.8 percent.

larisa86 [58]

Answer:

expected return on market = 0.10373 or 10.373%

Explanation:

Using the CAPM, we can calculate the required/expected rate of return on a stock. This is the minimum return required by the investors to invest in a stock based on its systematic risk, the market's risk premium and the risk free rate.

The formula for required rate of return under CAPM is,

r = rRF + Beta * rpM

Where,

rRF is the risk free rate

rpM is the market risk premium

We will first calculate the market risk premium using the required rate of return for stock, beta and risk free rate and plugging these values in the formula above.

0.1330 = 0.058 + 1.64 * rpM

0.1330 - 0.058 = 1.64 *rpM

0.075 = 1.64 * rpM

rpM = 0.075 / 1.64

rpM = 0.04573 or 4.573%

As we know that the beta for market is always equal to 1, we can calculate the rate of return for market as,

expected return on market = 0.058 + 1 * 0.04573

expected return on market = 0.10373 or 10.373%

7 0

3 years ago

Kaiser Industries has bonds on the market making annual payments, with 14 years to maturity, a par value of $1,000, and selling

9966 [12]

Answer:

The Coupon rate is 11.66%

Explanation:

Yield to maturity is the annual rate of return that an investor receives if a bond bond is held until the maturity.

Face value = F = $1,000

Selling price = P = $1,382.01

Number of payment = n = 14 years

Bond Yield = 7.5%

The coupon rate can be calculated using following formula

Yield to maturity = [ C + ( F - P ) / n ] / [ (F + P ) / 2 ]

7.5% = [ C + ( $1,000 - 1,382.01 ) / 14 ] / [ ( $1,000 + $1,382.01 ) / 2 ]

7.5% = [ C - $27.29 ] / $1,191

7.5% x $1,191 = C - $27.29

$89.33 = C - $27.29

C = $89.33 + $27.29 = $116.62

Coupon rate = $116.62 / $1,000 = 0.11662 = 11.66%

4 0

3 years ago