Answer: The value of the firm is $16 million.
For this question we use the Modigliani-Miller Proposition I which states that the value of the firm is same irrespective of the amount of equity and debt in its capital structure, ignoring taxes.
Amount borrowed for buyback = $1m
No. of shares bought back = 2500
Value per share = $
Shares outstanding before buyback = 40000 shares
Shares bought back = 2500 shares
Shares outstanding after buyback = 
Next we calculate the value of the firm before and after buyback of shares.
The value of the firm before buyback comprises of only 40000 equity shares. There is no debt. Hence,
The value of the firm after buyback will be
Since value of the firm before and after buyback of shares is the same, we can say that the Modigliani-Miller Proposition I without taxes holds and the value of the firm is $16 million.
Answer:
a decrease of $39,000.
an increase of $39,000.
a decrease of $19,500.
an increase of $19,500.
The correct option is the last one,an increase of $19,500
Explanation:
The impact on net operating income when the department is eliminated in Fabio Corporation is the company would lose the contribution margin of $39,000 and avoidable fixed cost,hence overall effect of the elimination is the difference between the contribution margin lost and the avoidable fixed costs which is computed thus:
Lost contribution margin $39000
Unavoidable fixed cost $19,500
Total fixed costs
avoidable fixed cost=$78,000-$19,500=$58,500
decrease in overall net operating income=$58,500-$39,000=$19,500
9 - f
10 - b
11 - d
12 - e
13 - c
14 - a
Answer: Option (C) is correct.
Explanation:
The Heckscher-Ohlin theory is based on the cause of comparative advantage and explains that it is the difference in the factor endowments among the countries that is the main cause of international trade.
Heckscher-Ohlin theory says that a country exports the commodity whose production requires the intensive use of nation's relatively abundant and cheap factor and a country imports the commodity whose production requires intensive use of nation's relatively scarce and expensive factor.
The behavior which demonstrates courtesy toward others in the workplace is, consulting with a coworker before intervening in one of his or her projects.
Answer: Option D.
Explanation:
Courtesy is being polite and kind. It means showing politeness in ones behavior. So the most appropriate behavior of courtesy in workplace is mostly certainly consulting before involving in his/her project.
Asking before intervening is important so as to avoid any conflict between the workers and it is also a good gesture towards other co workers. This thus demonstrates the courtesy towards others. Consulting shows respectfulness towards the other person, thus resulting in courtesy behavior.
