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Dafna1 [17]
3 years ago
5

The capital structure of Merritt Co. is 20% common equity and debt equal to 80%. The cost of common equity is 10% and the pretax

cost of debt is 5%. Merritt's tax rate is 21%. What is Merritt's weighted-average cost of capital?
Business
1 answer:
olchik [2.2K]3 years ago
7 0

Answer:69

Explanation:

You might be interested in
Which of these statements is true?
olasank [31]

Answer:

Compound interest will lead to a larger sum of money than a comparable simple interest payment.

Explanation:

The true statement is that compound interest will lead to a larger sum of money than a comparable simple interest payment because the interest are compounded for a certain number of times such as daily, weekly, quarterly or annually while simple interest isn't compounded at all.

To find the future value, we use the compound interest formula;

A = P(1 + \frac{r}{n})^{nt}

Where;

A is the future value.

P is the principal or starting amount.

r is annual interest rate.

n is the number of times the interest is compounded in a year.

t is the number of years for the compound interest.

Mathematically, simple interest is calculated using this formula;

S.I = \frac {PRT}{100}

Where;

S.I is simple interest.

P is the principal.

R is the interest rate.

T is the time.

6 0
2 years ago
When a company like Gawker Media finds a potential pool of employees, like the individuals they find posting great comments onli
docker41 [41]

Answer:

b. application form

Explanation:

Based on the scenario being described within the question it can be said that they most likely have these individuals fill out an application form. Like mentioned in the question this is the first step in the pre-screening process in which individuals fill out a form that has all of their basic information, including skills, previous work experience, age, name, id number etc. All information that the employer may need to evaluate their potential for the job that they are hiring for.

4 0
3 years ago
An individual has utility function U(x)=x1/4U(x)=x1/4 for salary, and is considering new job offer which pays $80,000 with a bon
vladimir2022 [97]

Answer:

108,280.22

Explanation:

Certainty equivalent is solved by taking the inverse utility function from the expected utility of a random wealth variable

U(x) = x^1/4

U^-1(x) = x^4

U^-1(x) === x^4

CE(x) = x^4

Salary   Bonus   Total income   U(x)= x^(1/4)       P(x)        U(x)*P(x)

80000       0          80000               16.82                1/7             2.4

80000    10000     90000               17.32                1/7            2.47

80000    20000    100000              17.78                1/7            2.54

80000    30000    110000               18.21                 1/7            2.6

80000    40000    120000              18.61                 1/7            2.66

80000    50000    130000              18.99                1/7            2.71

80000    60000    140000              19.34                1/7             <u>2.76</u>

Sum                                                                                             <u>18.14</u>

CE(x) =  18.14^4

CE(x) = 108280.22

So therefore,  the certainty equivalent of this job offer is 108,280.22

5 0
3 years ago
Inflation is a decrease in the average price level in the economy.
Rama09 [41]
This is false. When inflation happens, prices go up in the economy.
7 0
3 years ago
Manziel Corporation constructed a building at a cost of $10,000,000. Average accumulated expenditures were $4,000,000, actual in
stira [4]

Answer:

$237,500

Explanation:

Cost of building      $10,000,000

Avoidable Interest            $300,000

Less;Salvage value           ($800,000)

Depreciation  Cost        $9,500,000

Depreciation per year $9,500,000/40=$237,500

7 0
3 years ago
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