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artcher [175]
3 years ago
13

CCC Corp has a beta of 1.5 and is currently in equilibrium. The required rate of return on the stock is 12.00% versus a required

return on an average stock of 10.00%. Now the required return on an average stock increases by 30.0% (not percentage points). Neither betas nor the risk-free rate change. What would CCC's new required return be? Do not round your intermediate calculations.
Business
1 answer:
Oxana [17]3 years ago
8 0

Answer:

CCC's new required return be 16.5%

Explanation:

For computing the new required return, first, we have to compute the risk-free rate of return which is shown below:

Expected return = Risk- free rate of return + Beta × (Market risk -  Risk- free rate of return)

12% = Risk- free rate of return  + 1.5 × (10%  -  Risk- free rate of return))

12% = Risk- free rate of  return  + 15% - 1.5% Risk- free rate of return

So, the Risk- free rate of  return is 6%

Now the average stock is increased by 30%

So, the new market risk is 13% and other things will remain constant

So, the new required return equal to

= 6% + 1.5 × (13% - 6%)

= 6% + 1.5 × 7

= 16.5%

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which manufacturing strategy can be described as producing products to put into inventory based on a demand forecast
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The make-to-stock manufacturing (MTS) strategy can be described as producing products to put into stock based on a demand forecast.

In this strategy, companies do not maintain productive stability over a period of time, but adjust their manufacturing strategy according to times when demand can increase or decrease.

Some advantages of the make-to-stock strategy are:

  • Economy of scale.
  • Waste reduction.
  • Efficiency in the use of resources.
  • Increased response time.

So this is an effective manufacturing strategy for companies that can accurately forecast their demand.

Learn more here:

brainly.com/question/24099922

8 0
3 years ago
The Campus Crustacean Company receives $2 per box for its crawfish and is selling 1,600 boxes to maximize its profits. What is t
erik [133]

Answer:

Profit per box of crawfish $0.25

Explanation:

To calculate the Total profit, we can solve the expression;

Total profit=Total selling price-Total purchase price

where;

Total purchase price=(Variable cost per box×number of boxes purchased)+Total fixed costs

Total purchase price=(1×1600)+1,200=$2,800

Total selling price=Selling price per box×number of boxes

Total selling price=(2×1600)=$3,200

replacing in the expression;

Total profit=Total selling price-Total purchase price

Total profit=($3,200-$2,800)=$400

Total profit=$400

To calculate the profit per box;

Total profit=profit per box(p)×number of boxes sold

400=p××1600

p=400/1600=0.25

Profit per box=p=$0.25 per box

7 0
3 years ago
In a market without price controls, producers charge ____ for their goods and services. This price allows producers to supply th
777dan777 [17]

Answer:

equilibrium prices

Explanation:

yeah-ya

3 0
2 years ago
You are the owner of a shoe company. You learn that it would be cheaper
diamong [38]

Answer:

Being a businessman and being charitable at the same time is just next to impossible at the time of expanding one's firm.

Explanation:

A business person's main motive has to be his ability to expand, so that he reaches that particular stage to do some charity for his fellow citizens. If you look at the unemployment part, then you must know that every person is somehow talented and in countries like the US, no one lives unemployed.

Therefore, it is necessary for a business person to calculate the cost factors, that does not only include the cost of labors, but also the cost of exporting the materials to Bangladesh and the cost of importing the final products. Then he needs to compare the total cost making the shoes in Bangladesh with making them via the US labors, and then take the decision accordingly.

3 0
3 years ago
Which two of the three financial statements would you find Net Income on?
xxTIMURxx [149]

Answer:

C) Income Statement and Cash Flow Statement

Explanation:

The Income Statement shows a clear separate entry for the Net income which is calculated after all the deductions and additions.

Net Income is the first balance shown on the cash flow statement after which the calculations are carried out to find the flow of cash in and out of the company.

Net income is also shown in the Balance Sheet but not separately but together with retained earnings. It is added to the retained earnings and the amount is shown as a whole amount of retained earnings  or shown as a change in equity.

So best answer is C because the question asked is where would you find Net Income on?

Meaning separately. So it is separately present on Income Statement and Cash Flow Statement.

Otherwise it is present  on all three statements ( on balance sheet as part of retained earnings or equity).

6 0
3 years ago
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