3 years ago

Differentiate between WACC and MCC in finencial accounting

1 answer:

3 0

Marginal cost of capital is basically addition to the cost due to the new project. WACC is for all projects running by company. If MCC and WACC both are given in the question, I would say choose MCC as MCC is more appropriate for choosing the new project, especially when “optimal” word is given in the question. WACC might not yield the correct decision as it could be either very low or very high. However, most of the time you undertake only those projects which are of same risk so WACC and MCC should ideally be same in general

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Money owed for products and services purchased on credit to be paid at a later date is known as _____.

shepuryov [24]

Accounts Payable

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2 years ago

The income statement reports financial information related to the following broad areas of business except

AleksandrR [38]

The answer is B. Operating expenses

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3 years ago

Ig=Ig=80 S=−80 + 0.4Y (Advanced analysis) The equations refer to a private closed economy, where Ig is gross investment, S is sa

aleksley [76]

Answer:

Equilibrium Income = 400

Explanation:

Economy is at equilibrium where :

AD (i.e = C + I) = AS (i.e = C + S)

C + I = C + S

I = S

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Putting in formula,

80 = -80 + 0.4Y

80 + 80 = 0.4Y

160 = 0.4Y

Y = 160/0.4

Y = 400

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3 years ago

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Hitman42 [59]

The bank’s action is considered to be legal though it is unethical. It is because having to take the information of Clement is legal though it is considered unethical because they used his information just to sell him the insurance policies.

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3 years ago

The Graber Corporation’s common stock has a beta of 1.8. If the risk-free rate is 5.8 percent and the expected return on the mar

Murljashka [212]

Answer:

16.96%

Explanation:

In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below

Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)

= 5.8% + 1.8 × (12% - 5.8%)

= 5.8% + 1.8 × 6.2%

= 5.8% + 11.16%

= 16.96%

The (Market rate of return - Risk-free rate of return) is also called market risk premium

3 0

3 years ago