Answer:
c. This increases only U.S. net capital outflow.
Explanation:
The net capitaloutflow is determinated by comparing the investemnt abroad with the investment of other countries in the national economy.
investment in foreing countries - investment from foreing countries.
In this case the US firm is investing abroad, therefore inceasing the net capital outflow of the US.
The Korea net capital outflow will decrease. because it is receiving investment.
Answer:
Transaction cost
Explanation:
Transaction cost is the cost that is typically in money or time format. It is the cost involved in the context of time or money when a decision is made or an agreement has been reached.
So according to the given situation, there is an excessive amount of time or money spent on parties so that it could be reached to an agreement
Therefore it represents the transaction cost
<span>consumer to share liability with a company.</span>
Answer:
13.7%
Explanation:
The weight to be placed on preferred while computing the company's weighted average cost of capital (WACC) is the market value of the preferred stock divided by the market value of the company as a whole.
market of preferred stock=5,000*$26=$130,000
Market value of the company=market value of common stock+market value of preferred stock+market value of bond
common stock market value=12,000*$39=$468,000
market value of bond=$400,000*87%=$348,000
Weight of preferred stock=$130,000
/($130,000
+$468,000+$348,000)=0.137420719
=13.7%
Answer:
year net cash flow
0 -$150,000
1 $80,000
2 $65,000
3 $50,000
4 $40,000
A) NPV = -$150,000 + ($80,000 x .87) + ($65,000 x .756) + ($50,000 x .658) + ($40,000 x .572) = -$150,000 + $69,600 + $49,140 + $32,900 + $22,880 = -$150,000 + $174,520 = $24,520
B) Yes , because the net present value indicates that the return on the proposal is greater than the minimum desired rate of return of 15%. Since the NPV is positive ($24,520), it means that the cash inflows are higher than the cash outflows when we use a 15% discount rate.
