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Doss [256]
3 years ago
13

(Expected return calculation) "DEF" is a firm that is traded on NASDAQ. On 1/1/2014, the company issued 10,000 zero coupon bonds

. Each bond has a face value of $100 and matures on 1/1/2019. The bonds are the only debt of the company. A bond rating company estimated the total value of the DEF's assets on 1/1/2019 as follows:
Probability Value of DEF assets on 1/1/2019
0.2 2,000,000
0.3 1,750,000
0.4 1,200,000
0.1 1,000,000

Two years after the bond issue, on 1/1/2016, the bond rating agency reexamined the DEF Company and estimated the total value of the firm's assets as follows:

Probability Value of DEF assets on 1/1/2019
0.05 2,000,000
0.25 1,750,000
0.65 1,200,000
0.05 1.000.000
a. What will be the influence of the new probability distribution on the expected return on DEF bonds?
b. What will be the influence of the new estimation on the DEF stock price, assuming the cost of capital for the stock holders is 15%?
Business
1 answer:
ohaa [14]3 years ago
6 0

Answer: I not the best with math so I want to say 1,000,000

Explanation:

10,000 zero bonds at 100 face value would be about 1 million plus 15 percent is would be 150,000

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Schager Company purchased a computer system on January 1, 2014, at a cash cost of $23,000. The estimated useful life is 10 years
MakcuM [25]

Answer:

Accumulated depreciation= $7,272

Explanation:

Giving the following information:

Purchased: January 1, 2014, at a cash cost of $23,000.

The estimated useful life is 10 years.

The estimated residual value is $2,800.

Under the double-declining balance, we need to use the following formula for each year:

Annual depreciation= 2*[(book value)/estimated life (years)]

2014= [(23,000 - 2,800)/10]*2= 4,040

2015= [(20,200 - 4,040)/10]*2= 3,232

Accumulated depreciation= $7,272

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2 years ago
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8 0
3 years ago
The unintended consequences of an economic change that are not immediately identifiable but are felt only with time are known in
sineoko [7]

We can actually deduce here that the unintended consequences of an economic change that are not immediately identifiable but are felt only with time are known in economics as: D. Secondary effects.

<h3>What is unintended consequence?</h3>

Unintended consequence, as seen in social sciences are known to be the result or outcome that is gotten from a purposeful action which were not seen coming.

The options that complete the question are:

a. scarcity constraints.

b. marginal effects.

c. opportunity costs.

d. secondary effects

We can actually deduce here that such unintended consequences of an economic change that are not immediately identifiable but are felt only with time are known in economics are known to be secondary effects.

Learn more about unintended consequence on brainly.com/question/17228614

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8 0
1 year ago
According to equity theory, in order to restore equity or fairness of a work situation a worker may ______. (select all that app
noname [10]

Group of answer choices.

A. try to have the inputs of coworkers increased

B. try to increase the outputs of coworkers

C. try to increase his or her own outputs

D. try to increase his or her own inputs

Answer:

A. try to have the inputs of coworkers increased.

C. try to increase his or her own outputs.

Explanation:

Adam Smith was a Scottish political economist, social and moral philosopher, author and he is famously considered to be the father of modern economics. Smith was born on the 5th of June, 1723 in Kirkcaldy, United Kingdom and he died on the 17th of July, 1790 in Panmure House, Edinburgh, United Kingdom.

The equity theory by Adam Smith helps to measure and strike a balance between the work input and output of a worker.

An equality norm can be defined as a reward system in which the employer or human resource manager decide to compensate or pay the entire workforce the same amount of money without discrimination or favoritism.

Basically, it's paid regardless of individual productivity levels, in order to promote the ability to work effectively in groups.

According to equity theory, in order to restore equity or fairness of a work situation a worker may;

I. Try to have the inputs of coworkers increased.

II. Try to increase his or her own outputs.

8 0
2 years ago
Solartech Corporation, a U.S. exporter, sold a solar heating station to a Japanese customer at a price of 143.5 million yen, whe
Ulleksa [173]

Answer:

$929,404.15 (approx)

Explanation:

The dollar amount actually earned by Solartech after exchanging yen for U.S. dollars :-

= Price ÷ One dollar bought

= 143,500,000  ÷ $154.40 yen

= 143,500,000 ÷ $154.40  yen

= $929,404.15 (approx)

Therefore for computing the dollar amount actually earned by Solartech after exchanging yen for U.S. dollars, we simply divide price by one dollar bought.

3 0
2 years ago
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