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3 years ago

Respond to the following comments:

Business

1 answer:

MakcuM [25]3 years ago

5 0

Answer:

Comment for statement A - The firm must still compare the IRR with the opportunity cost of capital when using the IRR rule. Therefore, even with the IRR method, the appropriate discount rate must still be specified.

Comment for statement B - There should be a higher discount rate on risky cash flows than the rate used to discount less risky cash flows.

Making use of the payback rule is equivalent to using the NPV rule with a zero discount rate for cash flows before the payback period and an infinite discount rate for cash flows thereafter.

Explanation:

“I like the IRR rule. I can use it to rank projects without having to specify a discount rate”

The firm must still compare the IRR with the opportunity cost of capital when using the IRR rule. Therefore, even with the IRR method, the appropriate discount rate must still be specified.

“I like the payback rule. As long as the minimum payback period is short, the rule makes sure that the company takes no borderline projects. That reduces risk”

There should be a higher discount rate on risky cash flows than the rate used to discount less risky cash flows.

Making use of the payback rule is equivalent to using the NPV rule with a zero discount rate for cash flows before the payback period and an infinite discount rate for cash flows thereafter.

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You earn $50,000 per year, and paid 10 percent in taxes this year. The government increased the tax rate to 20 percent for next

AleksAgata [21]

Answer:

D. $10,000

Explanation:

The answer is D because as you earn $50,000 every year, and for the next year the tax rate is 20%, 20% of $50,000 is $10,000. Hope it helps!

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3 years ago

Is the cost of equity calculated from the CAPM model, pre -tax or post-tax?

Natasha_Volkova [10]

The existence of pre-tax cost of debt and post-tax cost of debt is due to the acknoledgement of the tax benefit from issuing debt.There is no tax benefit from paying divdends,so it makes no sense talking about pre-tax,post-tax cost of equity for a firm.When you think about cash flow to equity you can only assume that the taxes owed by the company have already been paid.Now, the taxation over the income of the shareholder is a whole different issue that does not take place in this discussion,since it is not taken in consideration either in cost of equity or cost of debt.

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3 years ago

Green design, sustainable packaging, waste management, and energy efficiency are aspects of the _________

Nastasia [14]

Green design, sustainable packaging, waste management, and energy efficiency are aspects of the technological segment of the general environment.

<h3>What is technological segment of the general environment?</h3>

The practice of creating physical items, the built environment, and services in accordance with ecological sustainability principles is known as "green design."

The creation and use of packaging that improves sustainability is referred to as sustainable packing. This entails a greater reliance on life cycle assessment (LCA) and life cycle inventory (LCI) to assist direct the use of packaging that has a smaller negative impact on the environment.

These elements are a part of the physical segment of the general environment that businesses have sought to address with environmental sustainability initiatives, along with energy efficiency (using alternative energy sources like solar, avoiding the use of oil to produce energy, and reducing the air footprint).

The technological area is focused on enhancing the goods and services offered by science. The rate at which new products are developed, the level of automation, and improvements in service industry delivery are a few examples of pertinent variables

The diversity of external elements that have an impact on an organization's performance and operation is known as the general environment, or macro-environment. These outside factors can decide whether a company encounters market opportunities or failures.

Hence, Green design, sustainable packaging, waste management, and energy efficiency are aspects of the technological segment of the general environment.

To learn more about General environment refer to:

brainly.com/question/14511315

#SPJ4

5 0

2 years ago

Fremont Enterprises has an expected return of 12 % and Laurelhurst News has an expected return of 24 %. If you put 56 % of your

Savatey [412]

Answer:

= 18.7%

Explanation:

<em>A portfolio is a collection of assets/ investment. The return on a portfolio is the weighted average of all the return of the individual assets weighted according to the percentage of total funds allocated to each assets.</em>

Expected return on portfolio:

E(R) =( Wa*Ra) + (Wb*Rb)

Wa = 56% , Wb = 100-56 = 44%

Ra = 12%, Rb = 24%

E(R) = (0.56*24%) + (0.44× 12%)

= 18.7%

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3 years ago

In the context of the skills that good managers should possess, which of the following statements is true of managers with a mot

Svet_ta [14]

Answer:

Explanation:

bcoz they want to motivate the employees to

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3 years ago