Answer: A. project cost of capital.
Explanation:
The project cost of capital is the minimum expected rate of project given the type of risk that is attached to it.
When a project is of a certain risk, the company will need a certain rate of return to compensate it for that risk.
This rate is the cost of capital and it is usually based on the company's Weighted Average Cost of Capital (WACC) which measure the cost the company incurs when using equity and debt to raise capital.
The project cost of capital will be a rate that compensates the company enough to enable it compensate its capital providers.
Answer:
Their yield to call is 8.672%
Explanation:
The rate of return bondholders receives on a callable bond until the call date is called Yield to call.
Use following formula to calculate the yield to call
Yield to Call = [ C + ( F - P ) / n ] / [ (F + P ) / 2 ]
Where
C = Coupon Payment = $1,000 x 11% x 6/12 = $55
F = Face value = $1,000
P = Call price = $1,125
n -= number of periods to call = 7 years x 2 = 14 periods
Yield to Call = [ $55 + ( $1,000 - $1,125 ) / 14 ] / [ ( $1,000 + $1,125 ) / 2 ]
Yield to Call = 46.07 / $1,062
Yield to Call = 0.04336
Yield to Call = 4.336% semiannually
Yield to Call = 4.336% x 2
Yield to Call = 8.672% annually
Stone criticizes the agency argument
because of the following reasons:
1.The law does not hold that directors
are mere agents of the shareholders
2. In the real world, the shareholders
do not select the directors
3. Why should the directors have more moral accountability
to the shareholders than to other people
Answer:
B. Official note of sale.
Explanation:
An official note of sale is a disclosure document for new issue municipal bonds. These bonds, when sold by the issuer, must ensure that an officail not of sale is distributed to all purchasers before or at the settlement. The notice of sale is distributed by underwriters.
Cheers.
Answer: E. Learning Curve
Explanation: The learning curve is usually adopted in evaluating the association between cost and output over a certain period of time. The learning curve shows how usually indicates the changes in cost and output associated with a task as employees or workers start to engage in a certain task or function. Generally, initial task performance by an employee usually result in higher cost output with gradual reduction in cost becoming visible as the Repetition of such task is being embarked upon by the employee.
