Answer:
Both A and B are true.
- A. All else held constant, if a company has a beta of 1.2, then the cost of equity for this company will increase if the risk-free rate decreases.
- B. If you assume a company has debt, then an increase in the tax rate will decrease the weighted average cost of capital for the company.
Explanation:
A)
The formula to calculate the cost of equity is:
cost of equity = risk free rate of return + [Beta × (market rate of return – risk free rate of return)]
e.g. market rate 15%, risk free rate 5%:
cost of equity = 5% + [1.2 x (15% - 5%)] = 5% + 12% = 17%
if the risk free rate decreases to 3%:
cost of equity = 3% + [1.2 x (15% - 3%)] = 3% + 14.4% = 17.4%
B)
the WACC formula = (cost of equity x weight of equity) + [cost of debt x weight of debt x (1- tax rate)]
if the tax rate increases, then the WACC will decrease because (1 - tax rate) will be lower.
Answer:
a-1) Pv = 52549
a-2) Pv = 56822
b-1) Fv = 77570
b-2 Fv = 83878
Explanation:
b-1) Future value:
S= Sum of amount of annuity=?
n=number of fixed periods=5 years
R=Fixed regular payments=13200
i=Compound interest rate= .081 (suppose annualy)
we know that ordinary annuity:
S= R [(1+i)∧n-1)]/i
= 13200[(1+.081)∧5-1]/.081
=13200(1.476-1)/.081
= 13200 * 5.8765
S = 77570
a.1)Present value of ordinary annuity:
Formula: Present value = C* [(1-(1+i)∧-n)]/i
=13200 * [(1-(1+.081)∧-5]/.081
=13200 * (1-.6774)/.081
=13200 * (.3225/.081)
=52549
a.2)Present value of ordinary Due:
Formula : Present value = C * [(1-(1+i)∧-n)]/i * (1+i)
= 13200 * [(1- (1+.081)∧-5)/.081 * (1+.081)
= 13200 * 3.9822 * 1.081
= 56822
b-2) Future value=?
we know that: S= R [(1+i)∧n+1)-1]/i ] -R
= 13200[ [ (1+.081)∧ 5+1 ]-1/.081] - 13200
= 13200 (.5957/.081) -13200
= (13200 * 7.3544)-13200
= 97078 - 13200
= 83878
Correct/Complete Question:
When a manager identifies an opportunity, he or she generates alternatives to pursue the opportunity, selects one of them, implements it, and then evaluates the results. This manager is acting out the ____ process.
A. decision-making
B. control
C. formal leadership
D. managing
E. alternative-generating
Answer:
A, decision-making
Explanation:
Simply put, decision-making can be defined as the process of making decisions.
These decision making processes involve identifying the problem, creating a solution, implementation and evaluation of solution. All these processes are psychological or cognitive as it helps the the individual to make a decision from a bunch of options.
As in the question, the identification of an opportunity, generation of alternatives, implementation and evaluation of the generated processes shows the manager is showing his or her decision-making qualities.
Cheers.
I believe the answer is A. <span>decrease; increase
</span><span>lowering the costs of production means that the company could still obtain the same amount of profit while reducing the price on the market.
Due to the development of technology, the production process will become more efficient, which lead to an increase of total quantity of the products on the market.</span>
Answer:
C
Explanation:
Generalization in reinforcers is where the reinforcement response transfers to another stimulus
Generalization in reinforcers are reinforcer that acquires its reinforcing strengths through its relation to multiple reinforcers. For example money can be a generalized reinforcer