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Whitepunk [10]
3 years ago
10

Your firm uses half debt and half equity. The shareholders need to earn 20%. The firm can borrow at 5%. The risk free rate is 2%

. The tax rate is 40%. Find the weighted average cost of capital.
Business
1 answer:
IgorLugansk [536]3 years ago
7 0

Answer:

11.5%

Explanation:

WACC = weight of equity x cost of equity + weight of debt x cost of debt x (1 - tax rate)

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Approximately two decades after a "baby boom," one could expect___________.
lana [24]

Answer:

b. an outward shift of the production possibilities curve along both axes

Explanation:

As we know that outward shift refers to the growth.

Baby boomers is a term used for the human generation born between 1946 and 1964 after the end of world war 2 when the birth rate across the world was narrowed and thereafter the emerging births of new infants were known as Baby Boom.

The main reasons of this outward shift were:

  • People started new families to cover the life gap of the loved ones they lost during the world war
  • People hoped that coming era will be of peace and business growth which they actually saw thereafter
  • People hoped to see the economic growth in upcoming years leading them towards business expansions and production growths as well
7 0
3 years ago
Leasing allows business owners to forecast cash flows more ________ because lease payments are ________ amounts paid over a part
Pie
Leasing allows business owners to forecast cash flows more ACCURATELY, because lease payment are FIXED amount paid over a particular time period.
Leasing involves paying a specified amount of money monthly or yearly for use of a particular landed property. Leasing fees are usually fixed in amount and this allows one to accurately calculate how much money one can expect from this source of revenue.
3 0
3 years ago
Juan has some shares of risky stock from a start-up company, and other shares of stock from an established company with much les
dem82 [27]

Answer: True

Explanation:

Diversifying a portfolio refers to investing in securities that either have a lower risk or risk that is not correlated such that the risk to the portfolio is reduced.

In this scenario, Juan is investing in different securities with varying risk levels so that the portfolio will not be completely wiped out if one security goes bust. To truly diversify his portfolio however, Juan should invest in more than other asset classes such as bonds

3 0
3 years ago
A country has a noninstitutionalized population of 243 million people. out of that number, 38 million are under the age of 16 70
rosijanka [135]

Answer:

The answer is 60%

Explanation:

Labor force is the total number of people that have job(employed) and the number of people who are willing, able and actively searching for job(unemployed) in a population.

Labor force participation rate is calculated by dividing the labor force by the noninstitutionalized population.

Labor force = employed + underemployed + unemployed

= 96 + 31 + 8

=135 million

So we have:

(135 ÷ 243) x 100 percent.

60% (the nearest whole percentage)

3 0
3 years ago
A municipal bond has yield to maturity of 4.83 percent. An investor with a marginal tax rate of 35 percent is indifferent betwee
mezya [45]

Answer: 7.43%

Explanation:

The yield to maturity simply refers to the total return that is expected on a bond as long as the bond is held till it matures.

In this case, since the investor is indifferent between this municipal bond and an otherwise identical taxable corporate bond, the yield to maturity of the corporate bond will be:

4.83% = Corporate bond YTM × ( 1- 35%)

4.83% = Corporate bond YTM × 65%

Corporate bond YTM = 4.83% / 65%

Corporate bond YTM = 0.0483/0.65

Corporate bond YTM = 7.43%

The yield to maturity of the corporate bond is 7.43%

3 0
3 years ago
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