Answer:
The correct answer is c. reduces; reduce.
Explanation:
Economic exposure is a type of exposure to exchange rate risk caused by the effect of unexpected currency fluctuations on a company's cash flows, foreign investment, and future earnings.
Economic exposure, also known as operating exposure, can have a substantial impact on a company's market value, as it has far-reaching effects and is long-term in nature. Companies can protect themselves against unexpected currency fluctuations by investing in currency markets (FX).
Unlike transaction exposure and conversion exposure (the other two types of currency exposure), economic exposure is difficult to measure accurately and therefore difficult to hedge. Economic exposure is also relatively difficult to hedge because it faces unexpected changes in exchange rates, unlike expected changes in exchange rates, which form the basis of companies' budget forecasts.
Answer:
The answer is $1,404,000
Explanation:
Total amount realized from the issuance: 40,000 shares x $24
= $960,000
Treasury stock repurchased:
6,000 shares x $26
=$156,000
Net income = $600,000
The total amount of stockholders' equity at December 31, 2018 is:
Net income + amount realized from issuance - amount of treasury stock
$600,000 + $960,000 - $156,000
$1,404,000
Answer:
WACC = 8%
Explanation:
WACC is the minimum return that a company should make to on its investment to satisfy the providers of funds (i.e loan providers and equity holders). The rate usually reflect the riskiness of the of the investment and finance structure used.
<u>Calculation</u>
WACC =(MV of Equity÷MV of the Company)Ke +(MV of Debt÷MV of the Company)Kd (1-t).
Where :
MV of the Company ⇒ MV of Equity+MV of Company
Ke ⇒ Cost of Equity
Kd(1-t) ⇒ Cost of Debt after Tax
WACC= (50/100)12.1% + (50/100) 6%(1-0.35)
= 6.05% + 1.95%
Hence, WACC = 8%
<u>Implication of Captital Structure on WACC</u>
Provided the investment was solely financed by equity instrument alone, the the WACC would have remained at 12.1%. However, with the introduction of debt finance, this has resuced our WACC to 8%.
The correct answer is production.
Production is the process of taking raw materials and turning them into goods and services.
Transactional leadership
Real estate broker ReMax wants staff members to close deals. There can be no business without sales. To bring the parties together and resolve any disputes, agents are compensated with commissions that are typically 1.5–3 percent of the sales volume. This benefits both ReMax and the agents.
This is an illustration of transactional leadership.
With transactional leadership, sometimes referred to as managerial leadership, an executive uses rewards and penalties to ensure that his or her employees perform to their full potential. They instill such a strong sense of dedication in their followers that they are willing to take risks with their own health and safety in order to deliver the outcomes the leader demands.
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