The expected return on the common stock should decrease.
To calculate the new expected return on the common stock, we need to calculate the new value of the common stock and debt. The new value of the common stock is $64 million + $16 million = $80 million. The value of the debt is reduced by $16 million to $20 million.
The new expected return on the common stock is 16.6% * ($80 million/$96 million) = 15.63%.
Therefore, the expected return on the common stock should decrease from 16.6% to 15.63%.
A security that symbolises ownership in a firm is called common stock. Common stock owners choose the board of directors and cast ballots for corporate rules. Long-term rates of return are often higher with this type of stock ownership.
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Answer:
0.8
Explanation:
Given:
Number of chips contained in each box = 10
Weight of each packet of chips = 3 ounce
Average weight per box = 853 grams
Upper specification limit of the weight = 846 + 12 grams = 858 grams
Lower specification limit of the weight = 846 - 12 grams = 834 grams
Standard deviation, σ = 5 grams
Now,
Capability index = 
or
Capability index = 
or
Capability index = 0.8
Answer: Option A
Explanation: Sales promotion is the method of convincing a prospective consumer to buy the commodity. Sales promotion is intended to be used as a brief-term tool to boost sales – it is seldom appropriate as a way to develop long-term customer retention.
Giving discount, rebates and other such special offers are some of the many examples of sales promotion. In simple words,it is done to boost the sales for the current period.
In the given case, Amazon is also offering money saving offers to attract customers. Hence we can conclude that this is an example of sales promotion.
Answer:
54.48%
Explanation:
The computation of the weight of equity is given below;
But before that we need to do the following calculations
Total Equity
= 3 million shares × $30
= $90 million
The Value of Debt,
Total Debt = 80,000 (1,000)(0.94)
= $75.2 million
Now the weight of equity is
= $90 million ÷ ($90 million + $75.2 million)
= 54.48%
