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lbvjy [14]
3 years ago
11

Cash flows that could be realized from the best alternative use of an owned asset are called​ ________. A. lost resale opportuni

ties B. opportunity costs C. sunk costs D. incremental costs
Business
1 answer:
Elan Coil [88]3 years ago
5 0

Option B

Cash flows that could be realized from the best alternative use of an owned asset are called opportunity costs

<u>Explanation:</u>

Opportunity costs describe the gains an individual, investor or firm misses out on when picking one choice over another.  Bottlenecks are usually a basis of opportunity costs.  Analyzing opportunity costs can lead you to extra effective decision-making. Opportunity cost investigation also performs a vital role in preparing a business's capital structure.

Opportunity cost cannot forever be completely quantified at the time when a decision has arrived. Alternatively, the person performing the decision can only approximately predict the consequences of various dilemmas

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Suppose Stark Ltd. just issued a dividend of $1.59 per share on its common stock. The company paid dividends of $1.25, $1.33, $1
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Answer:

Explanation:

arithmetic average growth rate = {[(1.33 - 1.25)/1.25] + [(1.40 - 1.33)/1.33] + [(1.51 - 1.40)/1.40] + [(1.59 - 1.51)/1.51]} / 4 = {0.064 + 0.053 + 0.079 + 0.053} / 4 = 0.06225 x 100 = 6.225%

geometric growth rate = ⁴√{0.064 x 0.053 x 0.079 x 0.053} = 0.061%

a) using arithmetic average growth rate

Div₁ = $1.59 x 1.06225 = $1.689

P₀ = $40

g = 6.225%

40 = 1.689 / (Re - 0.06225)

Re - 0.06225 = 1.689 / 40  = 0.04222

Re = 0.04222 + 0.06225 = 0.10447 = 10.45%

b) using geometric average growth rate

Div₁ = $1.59 x 1.061 = $1.68699

P₀ = $40

g = 0.061%

40 = 1.68699 / (Re - 0.061)

Re - 0.061 = 1.68699 / 40  = 0.04217

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8 0
3 years ago
Moerdyk Corporation's bonds have a 15-year maturity, a 7.25% semiannual coupon, and a par value of $1,000. The going interest ra
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Answer:

Value of bond = $1,101.59

Explanation:

We know,

Value of bond = [I × \frac{1 - (1+r)^{-n}}{r}] + \frac{FV}{(1+r)^{n}}

Given,

Face value (FV) = $1,000.

Semiannual Coupon, I = FV x semiannual coupon rate = $(1,000 × 7.25%) ÷ 2 = 72.5 ÷ 2 = $36.25

Interest rate, r = 6.20% ÷ 2 = 3.10% = 0.031

Maturity, n = 15 years = 30 periods (As it is semi annual).

Therefore,

Value of bond = [$36.25 × \frac{1 - (1 + 0.031)^{-30}}{0.031}] + ($1,000 ÷ 1.031^{30})

or, value of bond = ($36.25 × 19.3495) + $400.17

value of bond = $701.42 + $400.17

value of bond = $1,101.59

8 0
4 years ago
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Answer:

b. Lower Higher

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As non interest bearing notes are issued on deep discounted value. The face value of the note is discounted to calculate the cash receipt from the issuance. So, the cash received will be higher than the face value of the note.

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It is B: what to do in case of a fire


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