Answer:
government's policy.
Explanation:
Govenment policies on tax decide what to tax and where to allocate the resources of the tax.
Answer:
D. international diversification
Explanation:
The Multinational corporations can reduce their risk by international diversification and reduced risk can increase debt capacity of MNC. The higher capacity to meet scheduled debt payment also reduces cost of capital.
The effect of international diversification on capital structure can be explained through
1. Co-insurance effect: Combining businesses with international firms provides reduction in operating risk and thereby increase debt capacity. This helps MNCs to include more debts in their capital structure.
2. Transaction cost theory. Internationalization is a way of internatilize intangible assets. Since intangible assets are not difficult to sale , international diversification helps MNCs to exploit their intangible assets. So MNCs with an eye of international diversification will try to develop these type of assets in their asset base.
3.Agency cost argument: MNCs will have high agency costs Diversification helps to reduce these agency costs International diversification creates larger markets and generates growth opportunities. Growth opportunities and debt ratios are inversely proportional .MNCs with higher growth opportunities will rely on equity rather than debt.
Answer:
11.78%
Explanation:
Weighted average cost of capital WACC determines firms cost of capital. It includes all sources of finance which are included in firms capital structure. The WACC is calculated with given formula:
WACC = E/V Re + D/V * Rd (1 - T)
Re = cost of equity
V = Firms Market value of Debt and Equity
Rd = Cost of debt
E = market value of equity
D = market value of debt
T = Marginal Tax rate
WACC = 14.7 * 1 / 1.45 + 8.1 * 0.45 / 1.45 (1 - .34)
WACC = .1013 + 0.0165
WACC = 11.78%
Answer: See explanation
Explanation:
Contraction: Contraction, is a phase of the business cycle that simply occurs gene there's decline in the economy. At this phase, the demand for goods and services reduces and there's decline in growth.
Business cycle: The business cycle shows the movement of the GDP which can either be upward or downward. It shows how the economy's doing.
Trough: The trough is a phase in the business cycle whereby the gross domestic product for a particular economy has stopped reducing and the economy has started to rise.
Disposable income: This is the income that is left with an individual after personal income tax has been removed from the personal income of such individual.
Net domestic product: Net domestic product is when depreciation is subtracted from the gross domestic product.
