Answer: C) Stock prices would only change on unexpected news
Explanation:
If the stock market was perfectly efficient, it would mean that all known information is already reflected in the stock price. This includes both historical and current data.
For the stock price to change therefore, there would have to be unexpected news that are not already accounted for in the price and so will force it to react positively or negatively.
Answer:
Hence, $ 145548.77 should be invested in B today for it to be worth as much as investment A 9 years from now.
Explanation:
Future value of investment A
=2180*(((1+(8%/12))^(9*12)-1)/(8%/12))
=343196.39
How much money would you need to invest in B today
=343196.39/(1+10%)^9
=145548.77
Answer:
Tax shield on depreciation = 600
Explanation:
given data
new piece of equipment = $11,000
salvage value = $1,000
marginal tax rate = 30%
average tax rate = 20%
time period = 5 year
to find out
net effect of annual depreciation on the free cash flow
solution
we know here cost of asset and Salvage value so we get depreciation cost
depreciation cost is = 11000 - 1000 = 10000
and
annual depreciation = 2000
so that Tax shield on depreciation will be
Tax shield on depreciation = 2000 × 30%
Tax shield on depreciation = 600
Answer:
Researching South American holiday destinations online.
Explanation:
As Carlton runs an adventure excursion company in South America and he'd like to increase the number of people booking his tours, researching South American holiday destinations online can lead potential customers to Carlton's company through Google Search ads. In this way, Carlton can have a better idea abut the trends and insights about his potential prospects which definitely will help him in attracting, targeting and getting them in a better and effective way, theretofore, he can increase the number of people booking his tours.
