Answer:
The correct answer is 8% annual rate of interest on the bonds.
Explanation:
The effective annual interest rate is 8%
Effective rate if interest (semi-annual) = (Effective interest / Outstanding Balance) x 100
Effective rate if interest (semi-annual) = (345,639 / 8,640,967) x 100
Effective rate if interest (semi-annual) = 0.04 x 100
Effective rate if interest (semi-annual) = 4%
The Effective Annual Rate of Interest = 4% x 2 = 8%
I would say first the Online Bank which has very low personnel costs could offer the highest interest rates, probably followed by the credit union in which members are all shareholders so they should receive preferential treatment, and finally the Traditional Banks which most likely have a higher overhead than the other two so the result would be lower interest rates on savings accounts to the customer.
Answer:
$174
Explanation:
The computation of the cost of goods sold is shown below:
As we know that
Cost of goods sold = Opening inventory + Purchase - ending inventory
= $142 + $432 - $400
= $174
By adding the purchase of merchandise and deducting the ending inventory from the opening inventory we can get the cost of goods sold and the same is to be applied
Hence, the cost of goods sold is $174
Answer: $67.5 million
Explanation:
Since we are given the information that all cash flows are paid back to the equity holders at the end of each year, the market value of its equity today will be:
= [EBIT × (1 - t) + Depreciation - Capital Expenditure - Change in Working capital] / (Cost of Capital - Growth rate)
= ($15 million(1 - 35%) + $3 million - $6 million) / 10%
= [$15 million (1 - 0.35) + $3 million - $6 million] / (10%
= ($15 million × 0.65) + $3 million - $6 million) / 0.1
= ($9.75 million + $3 million - $6 million)/0.1
= $6.75 million / 0.1
= $67.5 million
