Which of the following is a primary benefit of entrepreneurial competition?

On Aug. 6, D submitted an application for a $50,000 Life insurance policy and did not pay the initial premium. On Aug. 18, D wen

MAXImum [283]

Answer:

B) collect initial premium along with a signed health statement

Explanation:

Since D submitted an application before he suffered from chest pains, then the producer should collect the initial premium. But the producer must also request a signed health statement which details the previous incident and what the doctor thought about it, and the tests that he requested.

5 0

2 years ago

Levered, Inc., and Unlevered, Inc., are identical in every way except their capital structures. Each company expects to earn $18

Fantom [35]

Answer:

Levered, Inc. and Unlevered, Inc.

Equity shares in the Levered, Inc. represents a better value.

Explanation:

a) Data and Calculations:

Levered, Inc. Unlevered, Inc.

Debts at 8% 65 million $0

Outstanding shares 1.9 million 3.8 million

Market price per share $98 $71

Equity value $186.2 million $269.8 million

Expected EBIT $18 million $18 million

Interest ($65 million * 8%) $5.2 million $0

Net income $12.8 million $18 million

Earnings per share $6.74 $4.74

Dividends per share $6.74 $4.74

b) The value of the equity shares in the Levered Inc. would have increased more if both firms pay taxes because of the tax advantage gained by deducting interest expense from the earnings before taxes. This shows that financial leverage increases the value of equity shares.

5 0

3 years ago

The Delta Manufacturing Company has a marginal tax rate of 21 %. The last dividend paid by Delta was $2.60. The expected long-ru

Musya8 [376]

Answer:

The stock price is 38.63

Explanation:

We use the gordon model to calculate the horizon value and with htat the value of the stock:

$\frac{D_1}{r-g} = PV\\\frac{D_0(1+g)}{r-g} = PV\\$

D1 = 2.60 x 1.04 = 2.704

rate of return 11% = 0.11

grow rate = 4% = 0.04

$\frac{2.704}{0.11-0.04} = PV\\$

P0 = 38.62857143

The taxes should be ignored as the gordon model do not include them in the calculations

5 0

3 years ago

What was the opportunity cost in a situation in which you use your available cash to buy gas for your car and then stay hungry t

Elodia [21]

Answer:

see below

Explanation:

Opportunity cost is the sacrificed benefit by choosing a preferred option over others. The value of opportunity cost is the foregone benefit from the best alternative.

In this situation, the person had to choose between buying gas for the car or using that money to purchase food. Since the person opted to buy gas, they sacrificed having a meal for the rest of the day. The pleasure derived from eating is the opportunity cost for this person.

4 0

2 years ago

Price elasticity of demand refers to the ratio of the:

Rudiy27

The ratio of the percentage change in the quantity demanded of a good to a percentage change in its price refers to the price elasticity of demand.

<span>To add, price elasticity of demand (PED or Ed) is a measure used in economics to show the responsiveness, or elasticity, of the quantity demanded of a good or service to a change in its price, ceteris paribus.</span>

8 0

2 years ago