Answer: False
A firm's weighted average cost of capital is a function of the capital structure mix
Explanation:
The capital structure of a firm is the proportion of debt and equity that result in the lowest weighted average cost of capital (WACC) .
A firm’s total cost of capital is a weighted average of the cost of equity and the cost of debt, known as the weighted average cost of capital (WACC).
The formula is equal to:
WACC = (E/V x Re) + ((D/V x Rd) x (1 – T))
Where:
E = market value of the firm’s equity (market cap)
D = market value of the firm’s debt
V = total value of capital (equity plus debt)
E/V = percentage of capital that is equity
D/V = percentage of capital that is debt
Re = cost of equity (required rate of return)
Rd = cost of debt (yield to maturity on existing debt)
T = tax rate
Answer:
$10
Explanation:
Steve achieved a producer surplus of $10, which is commensurate with the value of the 6-pack of beer he received from his neighbor. This means he practically sold the old surfboard for $10.
Answer: There will be an effect as there might be labor shortage.
Explanation: Minimum wage is the least renumeration pay that can legally be paid by employers to their workers. It is a price floor method below which employees can't sell their labor. When a minimum wage is imposed by the government, firms are not allowed to pay less than the wage rate mandated by the government.
If the minimum wage is set below the equilibrium wage rate, quantity of labor reduces in comparison to the quantity demanded by employers. If the least paid person is paid $16 per hour and the government imposes a minimum wage of $10, There will be a shortage of labor because most people won't like to work as a result of the lower income. It also leads to lack of motivation among workers.
Answer:
Inflation in 2012:
= 10%
Inflation in 2013:
= 9.09%
Inflation in 2014:
= 5%
Real rate of interest = Nominal - inflation
Given that,
Nominal rate = 8%
Therefore,
Real interest rate is as follows:
2012:
= 8% - 10%
= -2%
2013:
= 8% - 9.09%
= -1.09%
2014:
= 8% - 5%
= 3%
$6000 at 8% grows to:
= 1000 × 1.08
= $6,480 in one year
which is invested again to grow to $6,998.4 in two years
which is invested again to grow to $7,558.272 in three years
so,
Total gain:
= 25.9712%
The price level increases in three years by:
= 26%
So,
Total real rate of return:
= Total gain - Percentage increase in prices
= 25.9712 - 26
= -0.0288%
Answer: Preventative maintenance and also it is needed for maintaining the value of the property
Explanation:
According to the given question, the process of replacing all the lighting system in the apartment and also re-coating, cleaning all the building is one of the process of preventive maintenance as it helps in regularly maintain and clean the building the so that the value of the property remain the same.
The main objective of the preventive maintenance is that it helps in improve the overall performance and taking various types of safety measures for improving the condition of the property.
The given jobs is considering as the preventive maintenance for the purpose of maintaining the actual value of the apartment. Therefore, The given answer is correct.