Answer:
The WACC change if the new tax rate was adopted is - 0.35%
Explanation:
For computing the WACC change, first we have to determine the after tax cost of debt by applying the 40% and 45% tax rate which is shown below:
After tax Cost of debt = Cost of debt × ( 1- tax rate)
For 40% tax rate, it would be
= 7% × ( 1 - 40%)
= 4.2%
For 45% tax rate, it would be
= 7% × ( 1 - 45%)
= 3.85%
The change in WACC would be
= 3.85% - 4.2%
= - 0.35%
Answer:
Valid because corporations can be a partner in a partnership
Explanation:
A corporation can become a partner in a partnership, because a corporation can do most of the same things as an individual. Corporations, like individuals, can own property and enter into contracts, both things that are necessary to become a partner in a business. Having a corporation as a partner may be advantageous under certain circumstances because corporations have more legal and financial protections for those who run them.
The answer is D. A company’s external value delivery network
consists of suppliers, distributors, and customers. Note that this list does
not involve the internal divisions of the company nor its competitor, but only those that it corresponds
with to be able to deliver their product or service.
Answer:
B) The yield on a 5-year Treasury bond must exceed that on a 2-year Treasury bond.
Explanation:
The yield on 5-year Treasury bond must be higher than a 2-year Treasury bond. This is because the expected inflation rate after 2-years will be constant at 4% and there is also a maturity risk premium which increase with the increase in maturity of the bond. Therefore, the correct answer is option B.
Answer:
the leading importer, but not the leading exporter in the world
