Answer: c. earns a higher return than the rate paid on debt.
Explanation:
If the debt that the company incurs leads to the company making more money than they are paying as interest for the debt, then more money will be available as net income which would increase the Return on Equity.
ROE is calculated by dividing the Net Income by Shareholder equity. Interest is an expense. If this expense is lower then the increase in net income as a result of the debt then it follows that net income would increase and so would ROE.
Answer:
a mortgage.
Explanation:
A mortgage is a type of loan where real estate serves as collateral. Usually mortgages are used by people wanting to buy real estate since they can borrow larger amounts of money.
In order for the borrower to receive money form the bank, he/she signs a contract by which the bank has a rightful interest in the property. In case the borrower doesn't pay, the bank can foreclose the property.
Answer:
I will accept the offer if the price per painting is $56,312.41 or higher.
Explanation:
We will calculate the present value of the other option which is, selling our painting as a freelancer.
C 315,000.00
time 5
rate 0.2
PV $942,042.8241
Now, we subtract the signing bonus of 100,000
942,042.83 - 100,000 = 842,042.83
And solve for the annual proceeds from the painting we need to equalize the opportunity cost:
PV 842,042.83
time 5
rate 0.2
C $ 281,562.03
Now, we divide by the 5 painting per year:
$281,562.03 per year / 5 painting per year = $56,312.41
Answer:
The break-even point in total units is 70
Explanation:
Particulars Large Fork Lift Small Fork Lift Total
Selling price Per Unit $80,000 $60,000
Less: Variable Cost Per Unit $24,000 $11,000
Contribution per unit $56,000 $49,000
Sales Mix 1 4
Total Contribution per $56,000 $196,000 $252,000
sales mix
Contribution per unit of sales mix ($252000/5) $50,400
Fixed Costs $3,528,000
Break-even point in total units ($3,528,000 / 50,400) 70
a. revenue tariff----------------a 6% tariff on oranges to provide money for the government.
Revenue tariff alludes to a set of rates planned for expanding public revenue. It can likewise be said as a tax exacted on import and fare to fund-raise for the government. Revenue tariff is any schedule or arrangement of rates or changes that are proposed to create income for the government.
b. protective tariff---------a 50% tariff on oranges to shield domestic orange growers from international competition.
Protective tariffs are tariffs that are established with the point of ensuring a domestic industry. Tariffs are likewise forced keeping in mind the end goal to raise government income, or to decrease a bothersome action. In spite of the fact that a tariff can all the while secure household industry and procure government income, the objectives of assurance and income augmentation recommend distinctive duty rates, involving a trade off between the two points.
c. retaliatory tariff-----------a 200% tariff on oranges to reply to a high tariff imposed by another country.
Retaliatory tariff refers to a tariff imposed as a methods for constraining a foreign government and expected to urge the give of correspondence benefits.
Retaliatory tariff is a tariff imposed to pressure another nation into evacuating its own tariffs or making exchange concessions.
