Answer: The answer is as follows:
Explanation:
Given that,
Total reserves = $200 billion
Required reserves = 12.5 % of checking deposits
Therefore,
(a) Money multiplier = 
= 
= 8
(b) Money supply = Money multiplier × Total reserves
= 8 × $200 billion
= $1,600 billion
(c) Now, if Fed increases the required reserves to 16% of deposits.
New Money multiplier =
= 
= 6.25
New Money supply = Money multiplier × Total reserves
= 6.25 × $200 billion
= $1,250 billion
Money supply decreases to $1,250 billion.
Answer:
-$4,889.94
Explanation:
The computation of the net present value is shown below:
Net present value = Present value after considering the depreciation and discounting factor - initial investment
where
Present value is
= After-tax net income + Depreciation expense
= $1,700 + $15,000
= $16,700
And its discounting factor is 2.4018
So, the present value is
= $16,700 × 2.4018
= $40,110.06
And, the initial investment is $45,000
So, the net present value is
= $40,110.06 - $45,000
= -$4,889.94
Answer:
Fred's seniority is a good defense for Grange
Explanation:
Based on the situation at hand and the details provided within the question it can be said that in Ellen’s suit against Grange for discrimination, most likely Fred's seniority is a good defense for Grange. Since Fred has been working at Grange Storage for a long time then Fred also has a right to claim that opening for himself.
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It doesn't require any skills or special talent to flip burgers.
Hope this helps! :-)
Answer:
The WACC is 8.75%
Explanation:
The WACC or weighted average cost of capital is the cost of a firm's capital structure. The capital structure is made up of debt, preferred stock and common stock.
The formula for WACC is,
WACC = wD * rD * (1 - tax rate) + wP * rP + wE * rE
Where,
- w represents the weight of each component in the capital structure or value of each component as a proportion of total assets
- r represents the cost of each component
- we take after tax cost of debt. So we multiply cost of debt by (1 - tax rate)
The weight of common equity = 1 - (0.53 + 0.15) = 0.32 or 32%
The WACC is:
WACC = 0.53 * 0.0712 * (1 - 0.29) + 0.15 * 0.109 + 0.32 * 0.1387
WACC = 0.0875 or 8.75%
