Answer:
D. A security's beta measures its non-diversifiable, or market, risk relative to that of an average stock.
Answer:
e. None of the answer choices are correct.
Explanation:
A capital structure that comprises of those securities which can dilute it's earnings per share to common stockholders, is termed as complex capital structure.
Convertible bonds grant the owners, the right to convert their bonds into stocks, which leads to a dilutive effect on earnings per share for common stock holders.
Similarly, stock options grants a right to employees to purchase company's stock at a rate lower than the market price. This again is dilutive in nature.
Warrants are just like call options but when those are exercised create a dilution effect on the earnings per share of the company. Here the holder gets an option to buy new shares at an exercise price at a future date.
Stock dividends refer to paying common stock holders in the form of additional stock issue rather than paying them cash dividend. Those dilute the stock's price.
Thus, all four lead to a complex capital structure.
Answer:
$13.5 million
Explanation:
Fractional Banking System- This is banking system where banks are required by the central banking authority to keep a certain percentage of their total deposit as the minimum reserve which they cannot lend out.
The idea behind this requirement is to help manage liquidity risk- a situation where a bank does not have enough cash to meet its deposit customers demand.
Required-reserve ratio: The minimum percentage that banks are required to keep as reserve is known as the required-reserve ratio. In this question, it is given as 10%. Multiply this ratio by the total deposit and you will get the required reserve in dollar amount.
Therefore the required reserve for this bank = 10% ×$15 million= $1.5 million
Excess reserve; Excess reserve is the balance of the total deposit over and above the required reserve. The bank can lend and create loan asset from this balance.
It is calculated as = Total deposit - Required reserve
So we apply this to our question
Excess reserve = $15 million - (10% × $15 million)
= $15 million - $1.5 million
= $13.5 million
<u>Answer:</u>
The action that is associated with a niche strategy choosing a target market that is not crucial to the success of major competitors.
Option: (C)
<u>Explanation:
</u>
- The major reason an organization chooses to adopt a niche strategy is to avoid the dominance of a particular competitor in the present targeted market that both the organizations are functioning in.
- A niche strategy helps the organizations to experiment with the market and see if the output they get is acceptable or not.
Answer: (C) Horizontal
Explanation:
The horizontal integration is one of the process in which the various types of organization or companies are increasing the overall amount of production of the products and the services in the supply chain.
The main purpose of the horizontal integration is to maintain the growth the of an organization by increase the level of product differentiation and also decease the competition in the market.
According to the given scenario, the horizontal integration is one of the concept that best illustrating about the merging process with the other competitors in the market at the similar stage in the value chain management.
Therefore, Option (C) is correct answer.