Answer:
The firm's cost of equity is C. 14.05 percent
Explanation:
Hi, we need to use the following formula in order to find the cost of equity of this firm.
Where:
r(e) = Cost of equity
rf = risk free rate
rm = Market rate of return
Everything should look like this.
So, this firm´s cost of equity is 14.05%
Best of luck
In explaining hedge funds to an investor, a registered representative might correctly characterize them as utilizing common stockholders.
- The potential for the greatest loss determines the riskiest situation.
- The inherent nature of leverage in futures trading is one of the main dangers involved. The most frequent reason for losses in futures trading is frequently a disregard for leverage and the dangers involved.
- Common stockholders always bear the most risk because they are the last to be compensated in the event of business liquidation. However, if the company is successful, common stockholders could stand to gain the most from ownership.
Learn more about common stockholders here
brainly.com/question/2528944
#SPJ4
Answer:For example, the Ricardian model of trade, which incorporates differences in technologies between countries, concludes that everyone benefits from trade, whereas the Heckscher-Ohlin model, which incorporates endowment differences, concludes that there will be winners and losers from trade.
Answer:
<u>The actual direct labor hours are 45,000.</u>
<u>The overhead rate for Year 2 is $1.74.</u>
Explanation:
Compute the actual direct labor hours:
<u>Therefore, the actual direct labor hours are 45,000.</u>
Compute the overhead rate for Year 2:
<u>Therefore, the overhead rate for Year 2 is $1.74.</u>
<u />
Working note:
Calculate the overhead rate for Year 1:
Answer:
The solution shows that a rate of return of 10% which provides an annuity factor of 4.868 generates an NPV which is equal to zero. Thus, our IRR or internal rate of return is 10%.
Explanation:
The IRR or internal rate of return is the rate at which NPV or Net Present Value of the investment becomes zero. We are provided with the initial outlay for the project and the annual cash inflows along with time period. Using the annuity factors given below, we need to find out the factor which makes the NPV zero. The NPV is calculated as follows,
NPV = Present Value of Cash Inflows - Initial Outlay
We can try out each annuity factor and see what NPV is generates.
1. 6% rate (Annuity factor = 5.582)
NPV = (30000 * 5.582) - 146040
NPV = $21420
2. 8% rate (Annuity factor = 5.206)
NPV = (30000 * 5.206) - 146040
NPV = $10140
3. 10% rate (Annuity factor = 4.868)
NPV = (30000 * 4.868) - 146040
NPV = $0
So, from the above solution we can see that a rate of return of 10% which provides an annuity factor of 4.868 generates an NPV which is equal to zero. Thus, our IRR or internal rate of return is 10%
