Answer:
firm must borrow $288000 to achieve the target debt ratio
Explanation:
given data
assets = $720,000
debt to total capital ratio = 40%
to find out
How much must the firm borrow to achieve the target debt ratio
solution
we get here debt here by Debt to Total capital ratio that is express as
Debt to Total capital ratio = Debt ÷ ( Debt + Equity ) ....................1
put here value we get debt
0.40 = 
debt = $288000
so firm must borrow $288000 to achieve the target debt ratio
Answer:
b. structural unemployment
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:
a. $1.2800
Explanation:
The AUD/SF cross exchange rate is as computed below:
==> AUD/$ ÷ SF/$
==> $1.60 / $1.25
==> $1.2800
So, the AUD/SF cross exchange rate is $1.2800
Answer:
$88,920
Explanation:
capitalized interest = weighted average accumulated expenditure for the year x interest rate of the loan = $889,200 x 10% = $88,920
Capitalized interest can be added to the basis of the new building that is being constructed. This way, the building's depreciable value will increase.