"According to the law of demand, with everything else being equal, the quantity demanded for a good or service will ____________
1 answer:
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If the government raises the excise tax of the product then supply curve tends to shift leftwards. Therefore, The above statement is false.
<h3>What is Supply Curve?</h3>The supply curve refers to the graphical representation of the supply and the prices of the commodity. It tells how the supply of the commodity affects the prices of the product.
The complete question is attached below.
According to the above situation, when government increases the taxes of the gallon of gasoline then the supply curve will shift leftwards as the supply decreases.
It will lead to the increment in the level of the prices as the demand of the product will fall. Therefore, the above statement is false.
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Answer:
WACC 10.38305%
Explanation:
<em><u>First we solve for the source of financing:</u></em>
Expansion: 5,900,000
60% Equity: 3,540,000
Retained Earnins 2,000,000
then 1,540,000 will be common equity
40% debt: 2,360,000 It can raise up to 3,000,000 so it will be sufficient
D 2,360
E 1,540
RE 2000
V 5,900
Now we can solve for Weighted average cost of capital
Ke 0.15
Equity weight 0.261016949 (1,540,000 / 5,900,000)
Kre 0.12
RE Weight 0,338983 (2,000,000 / 5,900,000)
Kd 0.1
Debt Weight 0.4 ( 2,360,000 / 5,900,000)
t 0.4
WACC 10.38305%