Answer:
e) Increase the required rate of return used to evaluate the project to reflect the higher risk of the project
Explanation:
As per the basic concept of investment, "higher the risk, higher the return".
Thus, an investor assumes a higher risk only in the scenario wherein the expected return would be commensurate with such risk. Investor would only invest in a risky asset when the return derived can compensate him for the excess risk assumed.
Required rate of return is an investors expectation of return from a project also referred to as the cost of capital.
So for the purpose of evaluating the project, the investor should use a higher required rate of return to signify higher risk which would reveal the true viability of the project.
Answer:
$1067 F
Explanation:
The spending variance for wages and salaries in July would be closest to $1067 F
The answer is e. brainstorming. Brainstorming is a group
activity technique, wherein a large number of ideas are created, while the
evaluation of these ideas are suspended and will be reviewed later on after
making a group agreement or decision. Brainstorming can also be used in terms
of solving a problem, by gathering ideas for a specific problem, through the
help of the spontaneous ideas given by the group’s members.
Answer:
B. $3,373
Explanation:
The computation is given below:
For Held- to -Maturity investment
Face Value of the bond = 100,000
Coupon rate = 6%, for Semi-annual Period should 6% ÷ 2 = 3%
Effective rate = 7% For Semi-annual Period should be 7% ÷ 2 = 3.5%
Now
Purchase Price of the Bond is
= 100,000 - 4000
= 96,000
Now
First interest :
Cash interest = 100,000 × 3% = 3,000
interest Revenue = 96,000 × 3.5% = 3,360
So,
Discount Amortized is
= 3360 - 3,000
= 360
And,
Carrying Value of the Bond should be
= 96,000 + 360
= 96,360
For Second YEar
Interest Revenue = Carrying Value Effective interest Rate
= 96,360 × 3.5%
= 3,372.6
= $3,373
The act of assessing opportunity cost involves making choices and dealing with consequences.
<h3>What is an
opportunity cost?</h3>
This refers to the most desirable alternative given up as the result of a decision.
It is also the concept that cost of something that has to be given up to enjoy something better.
Hence, the act of assessing opportunity cost involves making choices and dealing with consequences.
Read more about opportunity cost
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