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4 years ago

A method to determine market risk by using the betas of single-product companies ina given industry

1 answer:

4 0

<span>Close A Market risk is measured by the project's beta coefﬁcient. It is assessed from the standpoint of a well-diversified stockholder. If accepting the project changes the firm’s systematic risk and overall rate of return to investors, it is market risk. Monte Carlo simulation is a computer-generated probability simulation of the most likely outcome, given a set of probable future events. It got its name from its roots in casino gambling. The base-case scenario is the most likely scenario in a capital budgeting analysis. It is the version where all variables are set at the expected result, as opposed to the best-case and worse-case scenarios. </span>

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Cindy is concerned because during the past four months her company has experienced difficulty in paying its bills on time. She k

elena-14-01-66 [18.8K]

Answer:

B.cash flow

Explanation:

Cash flow indicates the incomings and outgoings of cash within an organization. Since Cindy's company is struggling with paying bills on time, that implies a discrepancy in the named in and out cash flows (outgoing payments are not released on time). Usually, cash flow is an indicator that tells us if a company is efficient in paying its debts on time.

7 0

3 years ago

What factors affect the time value of money and the cost of borrowing money?

sergejj [24]

1.Interest rates
The interest rate level is moved higher or lower by a country's central bank to either stimulate or slow down an economy. Higher interest rates impose a more costly fee to borrow money while lower interest rates lessen the fee and usually spur more borrowing

2.Economic growth
The strength of an economy can go a long way to boosting the strength of the nation's currency. A strong growth rate in a country will see a growing demand for products and services with better job prospects for workers as well as being an attractive destination for capital and investments.

3.Inflation
When a product rises in price, it signals that there is an underlying demand for that product. Higher prices may not seem good to a consumer, but it is generally considered healthy for a country to have a moderate increase in inflation in a growing economy.

5 0

3 years ago

The role of the Securities and Exchange Commission (SEC) in the formulation of accounting standards can be best described as1. i

Dvinal [7]

Answer:

2. Varied- the SEC relies on FASB to develop standards but gives advice and recommendations to the private sector as needed.

Explanation:

The FASB, Financial Accounting Standards Board is an independent non- profit organization, formed in 1973, that is tasked with establishing accounting as well as financial reporting standards for profit and nonprofit organizations in the USA. It also has the authority to interpret generally acceptable accounting principles for private and public companies in preparation of financial reports and presentation of such reports. The SEC like every other organization, relies on the FASB to formulate rules and regulations (standards) for public companies mainly while giving private companies recommendations. The FASB is recognized by state accounting boards such as AICPA (American Institute of Certified Public Accountants) among other accounting boards.

I hope this helps.

8 0

4 years ago

What was a major result of Henry Ford's innovative manufacturing technique?

NeTakaya

B) The sale price of cars went down.

8 0

3 years ago

iRobot Company is analyzing two machines to determine which one it should purchase. Whichever machine is purchased will be repla

zimovet [89]

Answer:

Machine A should be purchased because it has a lower equivalent annual cost . Hence, it is cheaper.

Explanation:

Equivalent Annual cost is the Present Value of the total cost over the investment period divided by the appropriate annuity factor.

Step 1 : Equivalent Annual cost of Machine A

PV of cash flows

PV of purchase cost = 487,000

PV of annual operating cost of $29,000

= 29,000× (1-(1+0.14)^(-6))/0.14

= 112,771.35

Total PV = 487,000 + 112,771.35= 599,771.35

Equivalent annual cost = 599,771.35 /3.889

Equivalent annual cost = 154,235.70

Step 2: Equivalent Annual cost of Machine B

PV of purchase cost = 315,000

PV of annual operating cost of $51,200

= 51,200× (1-(1+0.14)^(-4))/0.14

= 149,182.07

Total PV = 315,000+ 149,182.07

= 464,182.07

Equivalent annual cost = 464,182.07/2.9137

Equivalent annual cost = 159,309.51

Step 3: Compare equivalent Annual cost

Comparing the two equivalent costs, we conclude that Machine A should be purchased because it has a lower equivalent annual cost and therefore it is cheaper.

8 0

3 years ago