Answer:
3/4 or .75
Step-by-step explanation:
slope = dy/dx
dy = 1 - -2 = 3
dx = 2 - -2 = 4
slope = 3/4
Beta= 1.3
Debt to equity ratio= 0.4
Market rate of return= 11.6%
= 11.6/100
= 0.116
Tax rate= 32%
= 32/100
= 0.32
Risk free rate= 3.3%
= 3.3/100
= 0.033
Pretax cost of debt= 7.2%
= 7.2/100
= 0.072
The firm's WACC can be calacluated as follows
RS= 0.033+1.3(0.116-0.033)
= 0.033+1.3(0.083)
= 0.033+0.1079
= 0.1409
WACC= (1/1.4)(0.1409)+(2/1.4) (0.072)(1-0.32)
= (0.7142)(0.1409) + (1.4285)(0.072)(0.68)
= 0.1006+0.0699
= 0.1705(100)
= 17.05%
Hence the firm's WACC is 17.05%
(a). To calculate Y at equilibrium
Y = C + I + G
Y = 40 + 0.8(Y – 0 + 10 + 20)
Y = 350
(b). To calculate C, I and G at Equilibrium
C = 40 + 0.8 Y
Since Y = 350
C = 40 + 0.8(350)
C = 40 + 280
C = 320
I = 20
G = 10
(c).To find
equilibrium Y
Given,
EX = 4 + 3EP/P
IM = 8 + 0.1 (Y - T) - 2EP/P
E = 3
P = 1
P = 1.5
Y = 170
12 is the diameter. We need the circumference which you get by multiplying 12x2 sides which = 24 which is the circumference
