Answer:
A
Explanation:
marginal resource cost is equal to their MRP.
Dividend to be paid to Preference shareholders in 2014= No of Preference shares*par value per share*Percentage of Shares
=2500*50*4%
=$5000
Dividends declared duing 2014=$3000, Thus Preference share holders need to be paid $2000 , in 2015, as preference shares are cumulative in nature.
Dividend to pe paid to Preference shareholders in 2015= $5000+$2000
=$7000.
Dividend to be paid to common share holders= $18000-$7000
=$11000
Thus B will be the answer.
first look at the starting value then approximately affect the ending value
Answer:
D
Explanation:
The risk premium is the difference in interest rate between two parties. It can also be defined as the overprice that a country pays to be financed by markets, in comparison with other country. The risk premium is popular in the bonds market. For example, country A has bond interest rate of 4% and country B has bond interest rate of 6%, the risk premium is the difference between both interest rates: 2%. We can conclude that country B is riskier than country A because it offers a reward to investors (2% more) to acquire their debt.
According to this, the risk premium is the maximum amount that a decision maker needs to compensate risk. The risk premium is defined by how risky a country is. (I would say that it is the minimum amount needed to compensate risk, but this is the answer that better fits with the risk premium definition).
