Who are risk takers in search of profits

A bond has a coupon rate of 6 percent and the bond makes semiannual coupon payments. The dollar amount of coupon interest receiv

vitfil [10]

Answer:

Explanation:

1. ) A bond that pays coupons is referred to as a coupon paying bond while that which doesn't pay coupons is known as a Zero-coupon bond.

The bond you are given bond has an annual coupon rate of 6% paid semiannually means that it will pay (6% / 2) = 3% every 6 months.

Semiannual coupon payment = semiannual coupon rate * Face value

The standard face value of a bond is $1000, therefore,

Semiannual coupon payment = 3%*1000 = $30

2.) WACC is weighted average cost of capital that takes into consideration the leverage effects of adding debt into a company's capital structure.

The formula for calculating WACC = wE*rE + wD*rD(1-tax)

wE = weight of equity = 250,000,000/1,000,000,000 = 0.25 or 25%

rE = cost of equity = 15% or 0.15 as a decimal

wD = weight of debt = 750,000,000/1,000,000,000 = 0.75 or 75%

rD = pretax cost of debt = 12% or 0.12 as a decimal

WACC = (0.25 *0.15) + [ 0.75*0.12(1-0.35) ]

= 0.0375 + 0.0585

= 0.096 or 9.6%

Therefore, WACC is 9.60%

5 0

3 years ago

There are many food carts near Mark’s university. Mark and his friends regularly buy hot dogs from Jeff’s cart. Recently, Andrea

ICE Princess25 [194]

Answer:

For the answer to the question above asking if Mark and his friends regularly buy hot dogs from Jeff’s cart. Recently, Andrea opened a business selling two-for-one hamburgers near Jeff’s cart. What will be effect on Jeff’s hot dog cart?

Explanation:

the answer is, the demand for his hotdogs will decrease because he will have competitors.

3 0

4 years ago

Your professor moonlights to make ends meet during the summer months and has a knack for painting houses. You agree to pay $500

Margarita [4]

Answer: Cost plus contact

Explanation:

A cost-plus contract is a form of contract whereby the contractor is paid for all of its allowed expenses including additional payments in order to allow for a profit.

A cost plus contract is usually used when the quality, delivery time and performance is of more importance than the cost. In cost plus contract, the final cost may be smaller than the fixed cost because the contractors don't usually inflate price and also as a result of lesser price competition.

A cost price contract also gives more room for control and oversight over a contractors work and is also flexible which gives room for specification changes.

4 0

3 years ago

Which of the following are functions of the Federal Reserve? Check all that apply. Maintaining federal government checking accou

Romashka [77]

Answer:

1. Maintaining federal government checking accounts and gold.

2. Maintaining and circulating currency.

3. Being the lender of last resort for banks

Explanation:

The Federal Reserve System (the 'Fed) was created by the Federal Reserve Act, passed by Congress in 1913. The Fed began operations in 1914. It was founded by President Woodrow Wilson under the Federal Reserve Act, which was aimed at backing each banks in order to put a definitive end to the bank panics of the 1800s.

The following are functions of the Federal Reserve;

1. Maintaining federal government checking accounts and gold.

2. Maintaining and circulating currency.

3. Being the lender of last resort for banks.

<em>Additionally, it comprises of twelve (12) Federal Reserve Bank regionally across the United States of America and seven (7) board of governors. </em>

5 0

4 years ago

Advantages corporations had over small business included: a. raw material discounts b. reduction of unit cost c. specialists d.

kondaur [170]

Answer:

a. Raw material discounts

b. Reduction of unit cost

c. Specialists

d. Better production methods

Explanation:

a. Corporations have various advantages over small businesses. Because they buy raw materials in bulk they are able to negotiate volume discount. This gives them more advantage over the small business who cannot buy in bulk.

b. A fall out from the above is reduction of unit cost or average cost, when discount is received it reduces the total cost of material and by implication the unit cost.

c. Because of their size and financial strength, corporation is able to attract qualified employees as opposed to small businesses that are limited by their financial position.

d. Corporations because of their financial strength are able to finance research with view to discovering a better production methods. This may be impossible to small businesses.

8 0

4 years ago