C relative price » sub effect & income effect
Answer:
A. $840,000
B. Discount
C. Annual interest expense on these bonds will be more than the amount of interest paid each year.
Explanation:
Data
Bonds issued = $21,000,000
Coupin rate = 4.0%
Market Interest rate = 4.46%
Requirement A: Annual interest amount
Interest amount = Bonds issued x coupon rate
Interest amount = $21,000,000 x 4.0%
Interest amount = $840,000
Requirement B: Whether it is Premium or Discount?
Bonds that Atom Endeavour Co. issued are discount as you can clearly see in the data that the market rate is higher than the coupon rate. Investors who will buy these bonds surely expect a capital gain.
Requirement C:
The discount on the issue of bonds is amortized to interest expense over the life of the bond, therefore the interest expense on these bonds will be more than the amount of interest paid each year,
Answer:
False
Explanation:
External factors in a SWOT analysis does not include the strengths and weaknesses of an organization. The full meaning of SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. The Strengths and weaknesses are internal factors to an organization as they have management control over it and can be modify as well.
The answer is B. Franchising
Licensing also use a similiar Model. But The Difference is When you do a Franchising , The company that own the trademark will give as support to aid the franchise. They also make sure that each branches do not cannibalized each others' profit.
In a Licensing model, the company who own the trademark won't give you any support whatsoever.
