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o-na [289]
3 years ago
6

Consider a project with free cash flows in one year of $90,000 in a weak economy or $117,000 in a strong economy, with each outc

ome being equally likely. The initial investment required for the project is $80,000, and the project's cost of capital is 15%. The risk-free interest rate is 5%.Suppose that to raise the funds for the initial investment, the project is sold to investors as an all-equity firm. The equity holders will receive the cash flows of the project in one year. The market value of the unlevered equity for this project is closest to:A) $94,100B) $90,000C) $86,250D) $98,600
Business
1 answer:
lozanna [386]3 years ago
5 0

Answer:

B) $90,000

Explanation:

The market value of the unlevered equity can be calculated using the following formula:

Expected value = Σpx

Where:

p = the probability of each outcome =50% in this case for both weak and strong economy.

x = the present value of cash flow for each outcome which is $90,000 in case of weak economy and $117,000 in case of strong economy.

Expected value= 0.50(90,000(1+15%)^-1)+0.50(117,000(1+15%)^-1)

                         =0.50(78,260.87)+0.50(101,739.13)

                         =$90,000

So the answer is B) $90,000

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Kevin announces that starting next financial year, 25% of his team members' salaries will depend on their performance. His team
____ [38]

Answer: Deciding  

Explanation:

The normative decision model is one of the type of theory that helps in explain the various types of optimal decisions that specifically helps calculating the accuracy of the given decision outcome.

 It basically provide the various types of prescriptive function and also the various types of rules that helps in maximizing the total outcome of the decision making concept.

According to the given question, the Kevin is basically demonstrating the deciding process based on the normative decision model as he announces that the 25% of the employees salaries is basically depending upon their specific performance in an organization.  

Therefore, Deciding is the correct answer.

3 0
4 years ago
Bear Tracks, Inc., has current assets of $2,350, net fixed assets of $11,100, current liabilities of $1,440, and long-term debt
OleMash [197]

Answer:

Owners Equity is $7,850

Net Working Capital is $910

Explanation:

Total Assets = Total Liabilities + Owners Equity

($2,350 + $11,100) = ($1,440 + $4,160) + Owners Equity

($13,450) = ($5,600) + Owners Equity

$13,450 - $5,600 = Owners Equity

$7,850 = Owners Equity

Net working capital is calculated as current assets - current liabilities

$2,350 - $1,440 = $910.

3 0
4 years ago
Oona wants to conduct research on personnel management, workplace environment, and what type of environment results in high leve
podryga [215]

Answer:

The answer is: industrial organizational psychology

Explanation:

Industrial organizational psychology studies individual employees and group dynamics in the workplace. It deals with problems that originate from different workplace situations (e.g. problems between employees or problems between management and employees) and proposes solutions to improve the well being of the people involved, increase their productivity and enhance the overall performance of the organization.  

4 0
3 years ago
Which motivation focuses on the fact that
eduard

The correct answer is C) theory Z.

The motivation that focuses on the fact that management and administration of contemporary organizations must consider the needs of the employee and, more importantly, how those needs can be met within the context of both the organization society as a whole is "theory Z."

When we are referring to the theory "Z," we are referring to the theory developed by economist William Ouchi. It was in the 1980s when Ouchi proposed this management style theory in the book "Theory Z: How American Business Can Meet the Japanese Challenge." The theory refers to the benefits of stable employment that generates productivity, and satisfaction in the workplace.

The other options of the question were A) theory X. B) theory Y. D) expectancy theory.

3 0
4 years ago
The period of time in which people starting a new job adjust and "settle in" is called the: A. the assimilation process. B. the
spayn [35]

Answer:

A. the assimilation process.

Explanation:

It is correct to state that the period of time in which people start a new job, adjust and settle down is called the assimilation process, which corresponds to a process in which the individual adapts to changes that will impact their way of living in society.

A new job, therefore, is an example of an assimilation process as a company has its own rules and regulations that an individual will have to assume when gaining a new position. Therefore, there is assimilation and adaptation to the new environment, rules and interpersonal relationships.

5 0
3 years ago
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