Cost of equity capital is closest to: 16 percent
Solution:
WACC is covered on page 120 Corporate Finance, under Capital Structure.
Using the standard equation for WACC = %wt Equity x cost of equity (re) + %wt Debt x cost of debt (rd).
Since there is a 20% tax rate for the firm, the cost of borrowing is reduced by that amount. So the cost of debt is 4%, not 5%.
Plug the formula: 10% = 50% x re + 50% x 4%
The formula ( i.e. 0.1+(0.1-0.05)(1)(1-0.2)) in CFAI reading is questionable.
The calculation is 0.1+(0.1-0.05*(1-0.2))*(1)=16%
Answer:
Bill shall win the case, even when he has a fault but that is not relevant.
Explanation:
In case Mary do not want the pair of shoes then she shall reject the pair, and pay the liability as stated in the contract, in case of fault by the party in the contract.
As she has many metal pallets also the fact that Bill delivers the shoes along with metal pallets and not with wooden pallets, is not a major default for the grounds to be sued by Mary.
As this clearly do not make any fault in the quality of shoes delivered, time of shoes delivered etc:
Thus, Bill shall win the case.
In the situational leadership model, the DELEGATING leadership style emerge when............. Situational leadership style involves adjustment of leadership style to specific situation to reflect employee needs. In delegating, the employee has learned all that is needed and is willing to occupy the leadership position.
Answer:
No, because they violated the duty of care
Explanation:
Business judgement rule is a provision that protects the management of a business from frivolous legal action concerning the way it does business.
The court assumes that the management acts in good faith in its fiduciary role, standard of loyalty, prudence, and care.
Duty of care is breached when the management do not make reasonable effort to prevent injury or loss.
In this instance Signal board is not protected by the business judgement rule because they violated duty of care.
Although the offer by Burmah oil is above the valuation a month ago, the board did not bother to do a present valuation or find out if other companies want to buy the subsidiary at a higher price.
Answer:
Explanation:
Previously the government was earning 22000 in tax revenue but since it increased the tax rate to 25%, Song taxable income went down to $82500. Therefore now government tax revenue is
25% of 82500 = 20625
So government tax revenue decreased by 1375 ( 22000-20625)
