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Svetllana [295]
2 years ago
10

Firm AB and Firm YZ are identical except for their debt-to-total-assets ratios (D/TAs) and interest rates on debt. Each has $200

,000 in assets, $40,000 EBIT, and a 40 percent marginal tax rate. Firm AB has a D/TA ratio of 40 percent and pays 7.5 percent interest on its debt, whereas YZ has a 60 percent interest on its debt and pays 10 percent interest on debt. Each firm has 5,000 shares of common stock outstanding. Calculate each firm's EPS and ROE (ROE = Net income/Equity). Discuss your results.
Business
1 answer:
Vilka [71]2 years ago
3 0

Answer:

the correct answer is

NOT AB EPS = $3.08

AB ROE = 17%

YZ EPS = $2.36

YZ ROE = 18%

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Explanation:

The statement that "BMW and United Airlines cannot be considered in the same industry analysis because they compete in different industries" is wrong.

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(I) To orient and enlightening the people

(II) To enhance its implementation

(III) To promote cordial actions.

(2) Background checks are important to

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(II) To understand the nature of threats and how best to mitigate them.

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Explanation: Information security is the process or system put in place to enhance,sustain and guarantee that the information flow,storage and use are done with reduced or eliminated threats.

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Ghella [55]

Answer:

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Explanation:

With compound interest the rate of growth needs to be compounded which is why the time period is used to exponentially adjust it.

With simple interest there is no compounding so the value is simply the interest that will be earned every period (which is a constant value) multiplied by the number of periods and the amount to be invested.

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