Answer:
After tax cost of debt is 6.82%
Explanation:
Currently the yield to maturity is the pre-tax cost of debt for Hype company, however the after tax cost of debt considers that the bonds are tax deductible , its actual is less than the pre-tax cost of debt , hence the after-tax cost of debt is shown below
After tax cost of debt=yield to maturity *(1-tax)
after tax cost of debt=11%*(1-0.38)
after tax cost of debt=11%*0.62
after tax cost of debt =6.82%
This confirms that cost of debt is usually lower than cost of equity , where shareholders would want an extra premium to compensate them for the increased risk taken by investing in the business.
Answer:
Nakawé, LLC produces and sells greeting cards in a competitive market. The total cost of producing 1000
greeting cards is $4000. The price of a greeting card is $4.
What is this firm's economic profit (or loss)?
Explanation:
or loss
Answer: $12
Explanation:
From the question, we are informed that Art purchased 2,500 shares of Delta stock and his purchase represents 10 percent ownership in the firm. We are further told that his shares have increased in value from the $12 a share he originally paid to today's market value of $13 a share.
Assume Delta goes bankrupt and owes $450,000 more in debts than the firm can pay after liquidating all of its assets, the maximum loss per share Art will incur on this investment will be the purchase price per share which was given in the question as $12.
This is because when a firm guess bankrupt, the maximum loss which will be incurred by Art will be the value of his investment which is $12.
Do it yourself this gets you no where im sorry