PV = A*[1-(1+r)^-n]/r
A = annual payment = $100,000
r = Interest rate = 8% = 0.08
n = Number of year = 20
PV = present value of the earnings
Therefore,
PV = 100,000*[1-(1+0.08)^-20]/0.08 = $981,814.74
In the 2,500-year-old text the art of war, chinese general sun tzu argues that "stratergy" and "planning" are key components of strategic planning.
<h3>What is strategic planning?</h3>
Strategic planning is the art of developing specific business strategies, putting them into action, and analyzing the results in relation to a company's overall long-term objectives or desires.
Some key features of strategic planning are-
- It is an idea that concentrates on incorporating different departments within a company (such as finance and accounting, marketing, & human resources) to achieve strategic goals.
- Strategic planning and strategic management are essentially interchangeable terms.
- The idea of strategic planning first gained popularity in the 1950s & 1960s, and it remained popular in the corporate world until the 1980s, when it began to fade.
- However, interest in business strategy was reignited in the 1990s, and strategic planning is still important in today's business.
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Answer:
Explanation:
Weighted Average Cost of Capital; formula is as follows;
WACC = wE*re + wP*wp + wD*rd(1-tax)
where w= weight of...
r = cost of ...
E= common equity
P = preferred stock
D = Debt
Find the weights of each source of capital;
WACC = (0.50*0.17) +(0.20*0.03) + [0.20*0.04(1-0.40)] +[0.10*0.07(1-0.40)]
WACC = 0.085 +0.006 + 0.0048 + 0.0042
WACC = 0.1 or 10%
1 million!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
