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2 years ago

What is the relationship among agency theory, economic consequences, and signaling?

Business

1 answer:

PIT_PIT [208]2 years ago

6 0

Answer:

In agency theory, the company is a nexus or locus among competing groups. At the cost of shareholders money, management try to maximize their its compensations. In economic consequences, the some gorups can benefit at the expense of others. This is due to the accounting standard. Economic consequences tend to complement agency theory. In signaling, it is primarily towards one group. It is neither be in agreement with agency theory or economic consequences.

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On January 1, 2020, Scottsdale Company issued its 12% bonds in the face amount of $3,000,000, which mature on January 1, 2030. T

BARSIC [14]

Answer:

It is $329,209.31

Explanation:

Please attached sheet for computation.

Download xlsx

5 0

3 years ago

The La-Z-Boy furniture company collects information about a wide variety of competitive, economic, political, legal and regulato

Stells [14]

Answer:

b) environmental scanning.

Explanation:

Environmental scanning -

It is the study that helps the organization to identify the threats and opportunities in the ecosystem to form new objectives and strategies in order to improve the performance in the industries .

It refers to the utilization and collection of the information regarding the trends , relationships and events of an industry and the usage of the knowledge for creating the objectives and strategies to future .

This process require the person working for the organization to search for important lessons m threat and weakness and opportunities .

Hence , from the data of the question , the process is called environmental scanning .

7 0

2 years ago

On December 31, 2021, Interlink Communications issued 6% stated rate bonds with a face amount of $119 million. The bonds mature

Tamiku [17]

Answer:

Price of the bond is $104,236,860.

Explanation:

Given:

Coupon rate is 6% or 0.06

Face value = $119,000,000

Coupon payment each year = 0.06×119,000,000

= $7,140,000

Yield to maturity = 7% or 0.007

Maturity period = 30 years

Price of bond = Present value of face value + present value of coupon payment (annuity)

Price of bond = $119,000,000_{(PV\ 30,0.07)} + 7,140,000_{(PVA\ 30,0.07)}$

PV of $1 for 7%,30 periods = 0.1314

PVA of $1 for 7%,30 periods = 12.409

Substitute the values in above formula:

Price of bond = (119,000,000 × 0.1314) + (7,140,000 × 12.409)

= 15,636,600 + 88,600,260

= $104,236,860

There will be slight difference in final answer as present value table is used. Excel spreadsheet gives an accurate answer.

So, price of bond is $104,236,860

8 0

2 years ago

Sherrie Hymes holds a $200,000 portfolio consisting of the following stocks. The portfolio's beta is 0.875. Stock Investment Bet

yuradex [85]

Answer:

The portfolio’s new beta will be 1.125

Explanation:

In this question, we are interested in calculating the portfolio’s new beta given the value of the beta of the stock which is used in replacing it.

We apply a mathematical approach here.

Mathematically;

Portfolio beta=Respective beta * Respective investment weight

=(50,000/200,000*1.5)+(50,000/200,000*0.8)+(50,000/200,000*1)+(50,000/200,000*1.2)

= 0.375 + 0.2 + 0.25 + 0.3 = 1.125

8 0

2 years ago

Why is it difficult for most small business owners to raise the capital needed to start, operate, or expand their ventures?

Andre45 [30]

Answer:

1. It is not easy to get funds for a start up, as many banks do not consider it as a successful decision to provide loan to a start up, as the feasibility of recovery of loan cannot be identified and guaranteed.

2. Venture capitalists also faces the same issue as of bank, also they are large equity investors and tend to invest in even larger project.

3. Private investors do not blindly invest and rather are more cautious then banks or venture capitalists, as because they do not huge funds to invest, and with less amount of investment they need even higher assurance.

4. Public stock is never available for a start up as for public stock issue you need great credibility, and good previous record.

4 0

2 years ago