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marusya05 [52]
3 years ago
11

Considering wacc, if the federal government suddenly stopped allowing deductibility of corporate debt interest, what would happe

n to the value of all corporations that issue step in their capital structure:
Business
1 answer:
mart [117]3 years ago
4 0
<span>Considering WACC, if the federal government suddenly stopped allowing deductibility of corporate debt interest, what would happen to the value of all corporations that issue step in their capital structure is that the risk of the project are the same as that of those other assets of the firm and would remain during the duration of the project and the project would support the same fraction  of debt to value as the overall capital structure that remains constant for the life of the project. </span>The weighted average cost of the capital or WACC is the company's average rate of return to compensate all its different investors and they represent the source of finance in the target capital structure of the company.
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A stock has an average expected return of 10.8 percent for the next year. The beta of the stock is 1.22. The T-Bill rate is 5% a
uranmaximum [27]

Answer: 4.7%

Explanation:

Expected return is calculated as:

= Risk free return + Beta ( Market risk premium)

10.8% = 5% + (1.22 × Market risk premium)

10.8% - 5% = 1.22market risk premium

5.8%/1.22 = market risk premium

Market risk premium = 0.058/1.22

Market risk premium = 0.047

Market risk premium = 4.7%

7 0
3 years ago
g Financial information is presented below: Operating Expenses $ 90,000 Sales Returns and Allowances 26,000 Sales Discounts 12,0
zheka24 [161]

Answer:

$104,000

Explanation:

Calculation to determine what Gross profit would be

Using this formula

Gross profit=Sales -Cost of Goods Sold -Sales Returns and Allowances-Sales Discounts

Let plug in the formula

Gross profit=$300,000-$158,000-$26,000- $12,000

Gross profit=$104,000

Therefore Gross profit would be $104,000

7 0
3 years ago
An agent's customer says that ABC Corporation is about to be bought out. The customer wishes to place an order to buy ABC common
tankabanditka [31]

Answer:

Explanation:

In this specific scenario, the best thing for the agent to do would be to bring the information to the attention of the firm's supervisory principal named to handle such matters in a Supervisory Procedures Manual. That is because inside information or insider trading is illegal and even though it does not need to be reported to the state securities Administrator, it should still be handled by the firm's supervisory principal in order for it to be handled correctly so that the firm does not get into trouble.

3 0
3 years ago
1. If you were going to buy a fuel-efficient car, which three would you consider? Why? Answer:
Ksenya-84 [330]

Answer:

Ford Fusion, Toyota Corolla and BMW i3

Explanation:

Fuel economy and fuel efficiency is one of the most important thing to consider when buying a car.

In United States, nearly 8 thousand gallons of petroleum are consumed by cars everyday. This cost a lot to the people's purse and most importantly it costs the atmosphere.

When we burn or use more fuel, the atmosphere gets more polluted by the exhaust of the fuel burning, and the world oil supply is depleting faster. This results in the rise of gasoline price. Thus, it is very necessary to plan before buying cars.

I would consider the cars Ford Fusion, Toyota Corolla and the BMW i3 while planning to buy a car because they are the most fuel efficient cars available in the U.S. They are also equipped with latest technology like cruise control which reduces the fuel consumption of the car.

The 2020 Ford fusion is a 6 speed automatic front wheel drive which gives the best driving experience and less energy wastage.

4 0
3 years ago
​When participants in one treatment condition have characteristics that are different from the characteristics of participants i
maw [93]

Answer:Internal validity

Explanation: Internal validity is a term used in research to describe how well experiments or researches are done, it is usually used to shows whether it avoids confounding, The less chance for confounding in a study, the higher its internal validity.

Internal validity tends to show the soundness of an experiment or research, it also shows how many Confounding variables you have in your experiment or research.

4 0
4 years ago
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