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dedylja [7]
3 years ago
6

Operating leverage is easier to control and manage than financial leverage because operating leverage deals with the internal wo

rkings of the company while financing deals with outside parties. True or False ?
Business
1 answer:
zzz [600]3 years ago
7 0

Answer: FALSE

               

Explanation: In simple words, operating leverage refers to the criteria which shows how much operating income can be increase by increasing the revenue of a project. Whereas, financial leverage refers to the level of debt that a firm has acquired for financing its operations.

The management of a company can easily control financial leverage as it is in their hands to issue or redeem debt. On the other hand, increase or decrease in operating income is dependent on various external factor.

Hence the given statement is false.

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An industry has three firms with unlevered betas of 0.7, 1.1, and 1.6. What is the discount rate to use for an unlevered firm th
lozanna [386]

18.9%

Finding a company's cost of capital is crucial in corporate finance for a few key reasons. For illustration, a corporation might calculate its net present value using the WACC discount rate. A lower WACC typically denotes a healthy company that can draw investors at a reduced cost. The industry has three firms with un levered betas of 0.7, 1.1, and 1.6.  the discount rate to use for a un levered firm that wants to enter this industry is 18.9% if the risk-free rate is 3 percent and the expected return on the market is 17 percent

The WACC discount formula is: WACC = E/V x Ce + D/V x Cd x (1-T)
To learn more about WACC please refer to -brainly.com/question/14223809
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7 0
2 years ago
Which option best defines taxable income?
Paha777 [63]

Taxable income is The amount of your income, after it has been reduced by exemptions, deductions, and credits, that is used to calculate the tax you owe.

7 0
4 years ago
Suppose the price of gasoline rises. As time passes, people adjust to the higher price, and the demand for gasoline becomes:
lesya [120]

As time passes, people adjust to the higher price, and the demand for gasoline becomes less elastic.

<h3>What is price elasticity of demand?</h3>

Price elasticity of demand measures how the quantity demanded of a good changes when price changes. Demand is elastic when quantity demanded changes more than the change in price. Demand is less elastic when quantity demanded changes less than the change in price. With the passage of time, demand becomes less elastic.

To learn more about price elasticity of demand, please check: brainly.com/question/18850846

3 0
3 years ago
Which of the following business opportunities allows a business to purchase and sell a company's products, but not the right to
Degger [83]

Answer:

Dealers/distributors allows a business to purchase and sell a company's products, but not the right to use that company's trade name as its own

<u>Explanation:</u>

Although only one out of every odd state with a dealers have opportunity which  similarly characterizes the term, the more significant part of them use the accompanying general criteria: A business opportunity includes the deal or rent of any item, administration, gear, etc. that will empower the buyer licensee to start a business.  

Moreover, business openings offer less help than opportunities; this could be a bit of leeway for you if you blossom with opportunity.

 

4 0
4 years ago
Ms. peterson buys a blue cardigan sweater from a departmental store in tampa. which type of good is the sweater?
Mashcka [7]
A sweater is a material good. This type of good is tangible and is a material item such as clothes, shoes, cars, machinery etc. The sweater is is also a public good because anyone walking into the department store has had and still  (given there is more stock) a chance to purchase the item. When a good is a public good, it is non-excludable and there is fair buying power. 
6 0
3 years ago
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