Based on the information given, the approach that describes the strategy that was used by the company is that Sen Corp. should issue the debentures since the after-tax cost of debt (5.347%) would be less than the cost of equity (5.825%).
A debenture simply refers to the rule of bond that's unsecured by collateral. Debentures typically rely on the reputation of the issuer.
From the complete information, the company wants to obtain $30 million in new capital to expand its plant. Therefore, it's appropriate to issue the debentures since issue the cost of equity is more than the after-tax cost of debt.
Learn more about debentures on:
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Answer:
PV= $17,228.23
Explanation:
Giving the following information:
FV= $20,000.
The number of years= 4.
interest rate= 3.8%.
To calculate the initial investment required to reach the objective, we need to use the following formula:
PV= FV/(1+i)^n
PV= 20,000/(1.038^4)
PV= $17,228.23
The correct answer is fears
People are often afraid of being late for important meetings or job interviews or anything similar, so if you buy the cell phone, you have nothing to fear. This is a pretty common marketing strategy.
Answer:
B
Explanation:
Only B appears plausible.
Higher debt means higher interest costs, which would lead to lower net income.
ROA = Net Income / Assets and ROE = Net Income / Equity
Now, assets are same, equity is different. Equity for HD will be lower while that for LD would be higher. Hence, predicting ROE is difficult as we don't know equity but ROA is a bit easier.
