Answer:
Slower economic growth
Explanation:
Increasing tax rates can generally and obviously discourage
work because corporations will pay more,
savings, because people earn lesser disposable income,
investment, because firms have lesser profit by paying bigger taxes,
Although specific tax adjustments for certain income categories can assist with the reallocation of economic resources.
But in the long-run economic growth will be slowed down by tax cuts because it will increase deficits by lesser funds being generated for the government over time
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Answer:
Re = 15.29%
Explanation:
beta at current debt level:
11.5% = 5% + (beta x 6%)
6.5% = 6%beta
beta = 6.5% / 6 = 1.083
unlevered beta = 1.083 / {1 + [(1 - tax rate) x debt / equity]} = 1.083 / {1 + [(1 - 40%) x 25 / 75]} = 1.083 / 1.2 = 0.9025
cost of levered beta at 60% debt:
0.9025 = beta / {1 + [(1 - 40%) x 60 / 40]}
0.9025 x 1.9 = beta
beta = 1.7148
Re = 5% + (1.7148 x 6%) = 15.29%
<span>A: to set interest rates</span>
Private Placement and Investment Banking Process, are the two ways that a company can issue new securities and thereby raise capital in the primary market
<h3>What is Primary Market?</h3>
The primary market is the area of the capital market where securities are issued and sold to buyers directly by the issuer, who then receives the proceeds.
Companies, governments, or public sector organizations can raise money in a primary market by issuing bonds, and corporations can do the same by selling new stock in an IPO (IPO). A financing syndicate of securities dealers, investment bank, or underwriter is frequently used for this.
Securities are issued by firms to investors directly in the primary market. Either a further public offering (FPO) or an IPO is used to issue securities (FPO). Through an initial public offering (IPO), a business can raise capital from investors and go public.
A business can raise money on the primary market by selling preference shares. Securities, equity, and debt
To know more about Primary markets, visit:
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