All categories

3 years ago

The permanent income hypothesis suggests that consumer:

Business

1 answer:

zimovet [89]3 years ago

5 0

Answer: d. spending depends on income people expect over the long term, rather than on current income.

Explanation:

The permanent income hypothesis states that people will spend money at a level equal to their permanent income which is their expected long-term average income.

The consumption function states that consumption is equal to autonomous consumption and consumption is dependent on disposable income.

The savings function shows the relationship between savings and income.

You might be interested in

R.S. Green has 250,000 shares of common stock outstanding at a market price of $28 a share. Next year’s annual dividend is expec

zhannawk [14.2K]

Answer:

WACC 6.18%

Explanation:

to get the cost of capital we solve using the gordon model:

$\frac{divends}{return-growth} = Intrinsic \: Value$

$\frac{divends}{Price} = return-growth$

$\frac{divends}{Price} + growth = return$

$$Cost of Equity =\frac{D_1}{P)} +g$

D1 1.55

P 28

f 0.00

g 0.02

$$Cost of Equity =\frac{1.55}{28} +0.02$

Ke 0.075357143

Then for the cost of debt, we need to calculate the YTM of the bonds:

which is the rate at which the present value of the coupon payment and maturity equals the market price:

For the complexity this is done with excel or a financial calculator there is also an approximation formula

YTM with excel: 0.073516565

now that we good this we need to determinate the weigth of equity and debt:

250,00 shares x 28 dollars each = 7,000,000

1,500 bonds of $1,000 each at 98% = 7,350,000

value of the company: 7,000,000 + 7,350,000 = 14,350,000

Ew: 7,000,000 / 14,350,000 = 0.487804878

Dw: 7,350,000 / 14,350,000 =0.512195122

Now we got all values and we can determinate the WACC:

$WACC = K_e(\frac{E}{E+D}) + K_d(1-t)(\frac{D}{E+D})$

Ke 0.075357143

Equity weight 0.487804878

Kd 0.074

Debt Weight 0.512195122

t 0.34

$WACC = 0.075357143(0.48780487804878) + 0.074(1-0.34)(0.51219512195122)$

WACC 0.0617752 = 6.18%

7 0

3 years ago

A recent national survey of U.S. adults revealed that 52% reported that they considered or made a career decision, such as looki

Maslowich

Answer:

The options for this answer are the following:

A. Lack of medical coverage

B. Sexual harassment at workplace

C. Stress in the workplace

D. Lack of upward mobility

The correct answer is C. Stress in the workplace .

Explanation:

Occupational stress is a type of stress associated with the scope of work that can be punctual or chronic, although most cases respond to the second type mentioned.

Positive stress (eustress) refers to when the stress response occurs in an adaptive way, the consequences of such response do not harm the integral health of the subject and its duration is coupled with the duration of the stress stimulus, eg, the response of stress that is triggered during your first day of work is adaptive (positive stress) because it implies that you have to be alert to attend to new stimuli (tasks, bosses, colleagues, company procedure, etc.).

When does this response cease to be adaptive and therefore can it become negative stress? Well, if this stress lasts more than a month, the response intensifies over time and begins to interfere with the worker's health (insomnia, tachycardia, anxiety, depression, among others) appear, it would be a case of negative work stress and measures should be taken.

8 0

3 years ago

On May 3, 2020, Windsor Company consigned 90 freezers, costing $480 each, to Remmers Company. The cost of shipping the freezers

aivan3 [116]

Answer:

a. Value of Ending inventory $ 22025

b. Profit= $ 10429

c. Amount Remitted to the Consignor $32454

Explanation:

Windsor Company

Goods Sent on Consignment 90 * $ 480= $ 43,200

Shipping Charges $ 850

Total $44050

Cost of One Freezer = $ 44050/ 90= $ 489.44

Cost of 45 Freezers= $22025

The ending inventory value is calculated by multiplying the unit costs with the units at hand.

a. Value of Ending inventory at the Hands of the Consignee = Units* Cost Price = 45 * $ 489.44= $ 22025

Sales by the Consignee 45* $ 780= $ 35100

b. Profit= Sales - (Cost + Expenses) = $ 35100- ($22025 + $2646)

= $ 10429

Profit is calculated by subtracting all the expenses and the cost from the sales

Installation Charges $330

Advertisement Costs $ 210

Commission (6% of 35100)= $2106

Total Expenses $2646

c. Amount Remitted to the Consignor = Sales - Expenses= ( $ 35100- $2646 )= $32454

3 0

3 years ago

Read 2 more answers

br company has a contribution margin of 40%. sales are $312,500, net operating income is $25,000, and average operating assets a

Klio2033 [76]

The company's return on investment ROI would be 12.5%

What does a favourable return on investment mean?

The profit from an investment is divided by the investment's cost to determine the return on investment (ROI). When represented as a percentage, an investment with a profit of $100 and a cost of $100 would have a ROI of 1, or 100%. Generally speaking, a yearly ROI of around 7% or higher is regarded as a decent ROI for an investment in stocks. This also refers to the S&P 500's average annual return when inflation is taken into account of the company to increase the profit margin.

To know more about ROI click on the link below:

brainly.com/question/15726451

#SPJ4

5 0

1 year ago

The relationship between quantity supplied and price is ________ and the relationship between quantity demanded and price is ___

mart [117]

Answer:

direct, inverse

Explanation:

Hope it helps

4 0

2 years ago