Answer:
The solution as per the given problem is provided below throughout the explanation portion below.
Explanation:
The given values are:
Debt issued,
= 120
Pretax earnings,
= 80
Tax,
= 35%
All equity firm,
= $320
Number of common stock,
= 50
(a)
Balance sheet before the debt issue's announcement will be:
<u>Assets </u><u> 320</u>
<u>Debt </u><u> 0</u>
<u>Equity </u><u> 320</u>
then,
The total will be "320".
(b)
The per share price will be:
= 
= 
= 
or,
After tax, the net income will be:
= 
= 
= 
= 
(c)
The return on equity will be:
= 
= 
= 
or,
= 
(%)
Answer:
(c) MUa/Pa = MUb/Pb
Explanation:
The Utility Maximization Rule is
MUa/Pa = MUb/Pb, where MUa represents the marginal utility derived from good a, Pa represents the price of good a, MUb represents the marginal utility of good b and Pb represents the price of good b.
Answer: The primary source of purchasing power used to buy imported goods is the exports of a nation.
Explanation: Purchasing power is important because it allows a company too important and export goods from one nation to another. Depending on what currency terms are given, allows a nation to import or export said goods. Inflation plays a role in deciding how much of said goods are imported and exported.
Answer:
Consider the following calculations
Explanation:
Co = low fare = $ 100
Cu = high fare - low fare = 400 - 100 = $ 300
Critical ratio = Cu/(Cu+Co) = 300/(300+100) = 0.75
In the table, look for F(q) >= 0.75 , that value is 0.792 and corresponding value of q = 12. Therefore,
Optimal protection level = 12
Refer the table for q=12, Expected shortage, L(q) = 0.5
Expected high fare seats to be sold = Mean demand - Expected shortage = 10-0.5 = 9.5
Probability of a full flight = 0.792
Answer:
North American Free Trade Agreement.
Explanation:
The regional trade agreement between Canada, Mexico, and the United States to eliminate tariffs and non-tariff barriers between themselves is known as the North American Free Trade Agreement. The North American Free Trade Agreement (NAFTA) has been signed as an agreement between Mexico, Canada and the US in January, 1994. This agreement basically superseded the Canada-United States Free Trade Agreement which was an agreement between Canada and the US. This agreement is recognized as one of the largest blocs in term of its GDP. The main goal and agenda of the North American Free Trade Agreement (NAFTA) was to eradicate the trade and investment blockage between these three countries in order to generate more freely processing of the trade activities in these three countries.
