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anyanavicka [17]
3 years ago
5

Bassett Fruit Farm expects its EBIT to be $373,000 a year forever. Currently, the firm has no debt. The cost of equity is 13.2 p

ercent and the tax rate is 35 percent. The company is in the process of issuing $2.8 million worth of bonds at par that carry an annual coupon of 6.6 percent. What is the unlevered value of the firm
Business
1 answer:
julia-pushkina [17]3 years ago
6 0

Answer:

The correct answer is $1,836,742.42.

Explanation:

According to the scenario, the given data are as follows:

EBIT = $373,000

Cost of equity = 13.2%

Tax rate = 35%

So, we can calculate the unlevered value of the firm by using following formula:

Unlevered value of the firm = EBIT × (1 - TAX RATE) ÷ COST OF EQUITY

By putting the value, we get

Unlevered value of the firm = $373,000 × ( 1 - 35%) ÷ 13.2%

= $373,000 × 0.65 ÷ 0.132

= $242,450 ÷ 0.132

= $1,836,742.42

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Answer:

d) joint property ownership

Explanation:

A partnership is created by two or more individuals who combine resources, skills, and energies to start a business. The motive for starting the business is profits.  The partnership deed guides the formation of a partnership business. Partners may also draft an agreement on how they will share profits, losses, or assets should be business be dissolved.

Partners contribute capital required to start and operate the business. The capital contributed may be in the form of cash, assets, or properties.  The contributed capital becomes part of the business assets. The assets are registered under the partnerships' name. For Robyn and Austin, the land will be in the name of their business if they have a partnership business.  But if they jointly own the land, a court may rule that they are not in a partnership business.

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3 years ago
PLEASE HELP IM ON PLATO BTW GET IT RIGHT CUH
Rasek [7]

Answer:

✔️Demand Pull Inflation:

1. Too much money chasing too few goods

2. Stiff competition among consumers

✔️Cash Pull Inflation:

1. Increase in cost of production

2. Decrease in supply of goods and services

3. Aim of sellers is to maximize profit

Explanation:

Demand pull inflation is often caused by the increase in the aggregate demand of outputs than an economy can produce as a result of increased government spending, expanding economy and so on.

On the other hand, cash pull inflation is caused by the decrease in aggregate supply of goods and supply as result of increased cost of the factors of production.

Thus, let's match each description to the types of inflation they belong to:

✔️Demand Pull Inflation:

1. Too much money chasing too few goods (excess demand as a result of expanding economy)

2. Stiff competition among consumers (businesses, households, governments and foreign buyers bid prices up and compete to purchase the limited available goods and services)

✔️Cash Pull Inflation:

1. Increase in cost of production (this pushes the cost of goods and services up)

2. Decrease in supply of goods and services (aggregate supply decreases)

3. Aim of sellers is to maximize profit (as production cost increase, sellers would have to increase the price of goods and services in order not to run at a loss).

7 0
3 years ago
A constraint with a positive slack value will have a positive dual price. will have a negative dual price. will have a dual pric
GREYUIT [131]

Answer:

will have a dual price of zero.

Explanation:

Slack variables are used in linear programming equation where the equation is not balanced and to balance the equation a variable equal to zero is introduced called a slack variable.

The constraint in the slack variable will be zero, where the positive value.

It is never equal to zero, but the value is so low and so near to zero that it is considered to be equal to zero.

8 0
3 years ago
Teresa looks over her notes about conversational customs in Europe, and then she carefully plans what time shell place a busines
Lunna [17]

Explanation:

This question configures that Teresa works in a globalized company.

Teresa's behavior is justified by the fact that she wants to adapt to the global ethical values ​​of the company and the country with which she will communicate, so that her operating stance in a different country changes so that there is greater understanding through communication and so that there is no ethical conflict related to the culture, behavior or customs of company workers in another country.

5 0
3 years ago
Leggio Inc. issued bonds with a 30-year maturity one year ago. The bonds have a 7% coupon, make one payment per year, and sold a
Talja [164]

Answer:

$1,302.82

Explanation:

The computation of the price that need to sell the bond is shown below:

Here we calculate the present value for the same

Given that

RATE = 5%

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PMT = $1,000 × 7% = $70

FV = $1,000

The formula is shown below:

=-PV(RATE;NPER;PMT;FV;TYPE)

After applying the above formula, the present value is $1,302.82

3 0
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