Answer:
Informative
Explanation:
It would use <u>informative</u> advertising
This attitude is called cash register honesty.
The book store worker knows very well that ball point pens, post-its, copies on the copier machine and long-distance phone calls are office resources and should, in principle, be used only for office purposes.
He is also aware that the he is responsible for his own needs - be it post-its or long-distance phone calls.
By taking some small supplies home or using the office equipment for personal use (e.g. making personal copies or making personal long-distance phone calls), he increases the cost to the company.
Yet, he continues to indulge in the activities described in the question, because he believes, at a personal level, that he can get away with it . (It's okay with him at a personal level.)
However, since stealing from the cash register is not ok with him on a personal level, he doesn't do it even though he knows he can get away with it. This attitude is called cash register honesty.
Stocks pay interest to investors through the year. Bonds only pay interest at fixed time during the year.
Answer:
The WACC is 11.64%
Explanation:
The weighted average cost of capital or WACC is the cost to firm of raising its total capital based on its capital structure. The capital structure of the firm can contain debt, preferred stock and common stock. The WACC take the weight of each component as a proportion of total value of assets and multiply it by the rate of return or cost of each component.
WACC = wD * rD * (1-tax rate) + wE *rE
Where,
- wD and wE represent the weights of debt and equity as a proportion of total assets
- rD and rE are the cost of debt and cost of equity
- We multiply rD by (-tax rate) because we take after tax cost of debt for WACC calculation
Weight of debt = 2000000 / (2000000 + 3000000) = 2/5 or 0.4
Weight of equity is = 1 - 0.4 = 0.6
WACC = 0.4 * 0.06 * (1-0.4) + 0.6 * 0.17
WACC = 0.1164 or 11.64%
