Answer:
Option D is correct.
Explanation:
Both company will have same Equity multiplier as total assets and equity are same of both companies. So Option A and B is incorrect.
Option C is also incorrect because there is no difference between the sales and total assets of both companies.
Option D is correct because the return on equity of the company LD is higher as the Net profit which is profit after interest and tax is higher than the profit after interest and tax of the company HD.
ROE = PAIT / Equity
Option E is wrong because when we say ROA is same this means that the operating income is same.
ROA = Operating profit / Total assets
Remember that the operating profit is earnings before interest and tax.
Answer: Surething Inc, needs to issue bonds with 11% interest rate in order to make Hugh indifferent between investing in two bonds.
We arrive at the answer in the following manner:
The City of Helfin bonds are municipal bonds and hence they are tax free. This means that Hugh will get an after - tax return of 6.6%.
The bonds of Surething Inc offering a 10% interest, however are taxed at 40%. So, the current after-tax returns of the bond is:
Current after tax return = 0.06 or 6%
However Hugh will be indifferent to investing in these two bonds only if they offer the same after-tax return of 6.6%.
Given this, we can calculate the indifference rate as follows:
Pre-tax return = 0.11 or 11%.
Answer:
The correct answer is option b.
Explanation:
A steep demand curve implies that the demand is relatively inelastic. In other words, a significant change in price will cause a small change in the quantity demanded.
A flatter demand curve, on the contrary, implies that a small change in price will cause a greater change in quantity demanded. In other words, demand is relatively elastic.
A change in price will not cause demand to change if the elasticity of demand is perfectly inelastic or when the demand curve is a vertical line.
A change in demand will be equal to the change in price if demand is unitary elastic.
Answer:
Boston
Explanation:
Based on the information provided within the question it can be said that A similar concentration has appeared around the city of Boston in the eastern United States of America. Similar to how "Silicon Valley" started, Boston has seen a drastic increase in Startup companies setting up shop in their city. This large amount of startups has attracted a lot of tech savy individuals to Boston and has created a similar environment to Silicon Valley.
