Answer:
Option (D) is correct.
Explanation:
In United states:
Can produce 25 tons of steel or 250 automobiles,
Opportunity cost of producing a ton of steel = 250 ÷ 25
                                                                           = 10 automobiles
Opportunity cost of producing 1 automobile = 25 ÷ 250
                                                                          = 0.1 tons of steel
In Japan:
Can produce 30 tons of steel or 275 automobiles,
Opportunity cost of producing a ton of steel = 275 ÷ 30
                                                                           = 9.17 automobiles
Opportunity cost of producing 1 automobile = 30 ÷ 275
                                                                          = 0.11
Therefore,
United States has a comparative advantage in producing automobiles because the opportunity cost of producing automobiles is lower than the Japan.
Japan has a comparative advantage in producing steel because the opportunity cost of producing steel is lower than the United states.
 
        
             
        
        
        
Answer:
cost of common equity = 14.46%
WACC = 11.29%
accept = Project A
Explanation:
Cost of common equity is the return that is required by Holders of Common Stock.
The available details can be used to calculate the cost of common equity using the Dividend Growth Model as follows :
Cost of common equity = (Next year`s Dividend / Current Market Price of a Stock) + Expected Growth
                                         = ($2.20/$26)+6%
                                         = 14.46%
WACC is the minimum return that a project must offer before it can be accepted.It shows the risk of the company.
Cost of Debt = Market Interest Rate × (1 - tax rate)
                      = 9.00% × (1-0.40)
                      = 5.40%
Capital Source                Weight                 Cost                 Total
Debt                                   35%                  5.40%               1.89%
Common Equity                65%                 14.46%               9.40%
Total                                 100%                 19.86%              11.29%
Therefore WACC is 11.29%
When evaluating projects, Compare the Project`s Internal Rate of Return (IRR) to the WACC.
<u>Project A</u>
IRR 12% > WACC 11.29%
Therefore Accept
<u>Project B/S</u>
IRR 11% < WACC 11.29%
Therefore Do Not Accept
 
        
             
        
        
        
Answer:
The value of the tracking signal as of the end of December is 8. 
Explanation:
month actual  forecast  forecast	RSFE absolute MAD Tracking signal
            sales  sales           error                error    
May      105  102              3            3      3              3                  1
june       78	104           -26	-23      -26     -11.5           2
july       108  101             7    -16         7     -5.33333            3
august	112	104              8  	-8      8      	-2             4
sep    108	104       4    -4      4      	-0.8             5
oct         110	104             6    2         6      	-0.6667      -3
nov    125	105           20  	22    20    3.142857143     7
dec    125	109            16          38    16      4.75          8
 
        
             
        
        
        
Answer:
The amount of annual cash dividends distributed to common shareholders relative to the common stock's market value is the:
Explanation:
The amount of annual cash dividends distributed to common shareholders relative to the common stock's market value is the: