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4 years ago

9

Assume that we are in the MM world. The beta of an all-equity firm is 1.4. Suppose the firm changes its capital structure to 40

percent debt and 60 percent equity. What is the equity beta of the levered firm

1 answer:

balu736 [363]4 years ago

8 0

Answer:

2.3

Explanation:

Levered Beta = Unlevered Beta x (1+D/E)

D/E = Debt-to-Equity Ratio

1.4 x (1 + 04 / 0.6) = 1.4 x 1.667 = 2.3

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You win the million-dollar lottery and decide to quit working. How can you explain this decision using economics

Mademuasel [1]

Answer:

the income effect now groverns your behaviour as you demand more leisure and the opportunity cost of leisure goes down

Explanation:

In economics, the cost of opportunity refers to when one person or business chooses one advantage over another.
When a person wins the lottery, the person's income increases. This increase in income motivates the person to choose more leisure at work. This means the person is ready to leave work for leisure. In this way, the potential cost of the holiday is reduced.
And with an increase in a person's income, a person's purchasing power improves. Increasing purchasing power means the person seeks more rest. Therefore, choosing to retire at work with an increase in income indicates an income impact. Therefore, if a person decides to quit his job, that person's behavior will be controlled by the income effect.

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3 years ago

What are the three reasons that companies import?

tankabanditka [31]

Answer: To meet customer demand, to take advantage of low priced goods or to purchase raw materials.

Explanation:

Import refers to the quantities of goods that are bought from other countries. Many companies trade to meet domestic customer's demand or to take advantage of lower priced product or to purchase raw materials which are not available domestically in order to produce finished goods domestically.

4 0

3 years ago

Sharon is unhappy with her job as a salesperson at a retail store for many reasons. Yesterday a customer asked her where the sha

Westkost [7]

This is an example of how job satisfaction can affect <u>"customer satisfaction ".</u>

Customer satisfaction is an estimation used to measure how much a client is content with an item, administration, or experience.

It is a proportion of how items and administrations provided by an organization meet or outperform client desire. Customer satisfaction is characterized as "the quantity of clients, or level of aggregate clients, whose revealed involvement with a firm, its items, or its administrations surpasses indicated fulfillment goals."

3 0

3 years ago

Explain why it might be more advantageous to borrow money from a credit union than to use other sources of credit.

german

Answer:

Explanation:

Credit unions offer higher savings rates and lower interest rates on loans. This means that their members are better served and might be able to save a significant amount on car loans, student loans, and mortgages.

5 0

3 years ago

Paparo Corporation has provided the following data from its activity-based costing system: Activity Cost Pool Total Cost Total A

lisabon 2012 [21]

Answer:

$142.10

Explanation:

The computation of average cost of product Q79Y is shown below:-

Activity cost <u> Total cost Total activity Activity Rate</u>

<u>pool</u>

Assembly $775,100 46,000 $16.85

Processing

orders $57,375 1,500 $38.25

Inspection $108,772 1,420 $76.6

Average cost

Direct Material Cost $41.00

Direct labor Cost $41.29

Total Direct Cost $37,031

( Material Cost + Labor Cost ) × Number of Units

Add :Assembly Cost $18,872

(1,120 Hours × $16.85)

Add :Processing Order Cost $4,208

(110 Orders × $ 38.25)

Add :Inspection Cost $3,830

(50 Hours × $ 76.6)

Total Cost $63,941

Average Cost = Total Cost ÷ Annual Units

= $63,941 ÷ 450

= $142.10

3 0

4 years ago