Answer:
The Weighted Average cost of capital measures the cost to the company of its current capital structure by using the weights of the various capital measures. WACC usually uses market values so;
Total amount = Debt + Preferred stock + common equity
= 100 million + 20 million + ( 50 * 6 million)
= $420 million
<u>Proportions.</u>
Debt
= 100/420
= 24%
Preferred Stock<u> </u>
= 20/420
= 5%
Common Equity
= 300/420
= 71%
Answer:
Option (B) is correct.
Explanation:
XA + XB = 100
QA = 100XA
QB = 200XB - XB^2
Use the fact that,
XA = 100 - XB
Now total production is Q = QA + QB
Q = 100XA + 200XB - XB^2
Q = 100 × (100 - XB) + 200XB - XB^2
Q = 10,000 + 100XB - XB^2
Output is maximum when Q'(XB) = 0
100 = 2XB = 0
XB = 50
XA = 50
Therefore, the firm’s profit-maximizing allocation of input X is 50 units of XA and 50 units of XB.
Answer:
$3.25
Explanation:
The new price for cigarettes will be the intersection point between the demand curves and the new supply curve.
Assuming S1 is the old supply curve without taxes and the new supply curve is S2 with taxes. The new price is the intersection of S2 and the demand curve, which is at $3.25.
Answer:
a. the discounted value of all future cash flows associated with the stock.
Explanation:
Stock prices can be seen as an estimated future value of the security. When investors buy shares they look at the performance of the business and buy shares based on this future analysis.
Also the issuer values the shares based on their future forecast of financial performance. For example when a share is issued for $1,000,000 the business would have estimated performance will justify the share price in the future.
