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Yuri [45]
2 years ago
8

Use the model developed in Chapter 3 and assume that consumption does not depend on the interest rate. Holding other things cons

tant, when the government lowers taxes on business investment, thus increasing investment demand, the quantity of investment: Group of answer choices and the interest rate are both unchanged. increases and the interest rate rises. decreases and the interest rate rises. is unchanged and the interest rate rises.
Business
1 answer:
tensa zangetsu [6.8K]2 years ago
3 0

Answer: increases and the interest rate rises.

Explanation:

As a result of the increase in a demand for investment, entities will borrow more money from financial institutions in order to undertake these investments.

Investments will therefore rise as a result. Unfortunately, due to the increase in demand for loanable funds from financial institutions, interest rates will rise as well to show that demand is increasing faster than supply of loanable funds as posited by the law of demand and supply.

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Bonds are a far more important source of financing than are stocks B. Financial intermediaries such as banks are the least impor
Anna71 [15]

Answer:

Bonds are a far more important source of financing than are stocks

Explanation:

There is so much of risk associated with the issue of stock. Though it is essential for any business to issue some stock, but bonds are always favorable as they have a defined maturity, defined amount associated, and defined interest payment.

There is no direct payment of interest in bonds but the expense is to be recorded in books as per the matching and accrual principle.

The discounted value of interest to be paid on maturity is recorded.

Further, there is a tax benefit on bond payments.

5 0
3 years ago
Presented below are certain account balances of Martinez Products Co.
Zepler [3.9K]

Answer:

a. Total net revenue:

= Sales revenue - Sales discounts - Sales returns + Rent revenue + Dividend revenue

= 410,000 - 7,930 - 12,560 + 6,610 + 71,490

= $467,610

b. Net income:

= Total net revenue - Cost of goods sold - Interest expense - selling expenses - income tax expense - administrative expenses

= 467,610 - 179,854 - 13,420 - 99,440 - 28,935 - 75,280

= $70,681

c. Dividends declared:

= Beginning Retained earnings + Net income - Ending Retained earnings

= 114,500 + 70,681 - 134,260

= $50,921

d. Income attributable to controlling shareholders:

= Net income - non-controlling interest:

= 70,681 - 19,240

= $51,441

4 0
3 years ago
which manufacturing strategy can be described as producing products to put into inventory based on a demand forecast
Gwar [14]

The make-to-stock manufacturing (MTS) strategy can be described as producing products to put into stock based on a demand forecast.

In this strategy, companies do not maintain productive stability over a period of time, but adjust their manufacturing strategy according to times when demand can increase or decrease.

Some advantages of the make-to-stock strategy are:

  • Economy of scale.
  • Waste reduction.
  • Efficiency in the use of resources.
  • Increased response time.

So this is an effective manufacturing strategy for companies that can accurately forecast their demand.

Learn more here:

brainly.com/question/24099922

8 0
3 years ago
Beale Manufacturing Company has a beta of 1.8, and Foley Industries has a beta of 0.80. The required return on an index fund tha
navik [9.2K]

Answer:

3.5%

Explanation:

We will apply asset pricing model to calculate cost of equity (required rate of return). The capital asset pricing model is stated as below:

Cost of equity = Risk-free rate + Beta x Market risk premium

Putting all the number together, we have:                          

Cost of equity (Beale) = 5.5% + 1.8 x (9% - 5.5%) = 11.8%

Cost of equity (Foley) = 5.5% + 0.8 x (9% - 5.5%) = 8.3%

Cost of equity (Beale) - Cost of equity (Foley) = 11.8% - 8.3% = 3.5%

<em />

<em>Note: You can also do quick calculation as below:</em>

<em>Cost of equity (Beale) - Cost of equity (Foley) = (Beta of Beale - Bete of Foley) x Market risk premium = (1.8 - 0.8) x (9% - 5.5%) = 3.5%</em>

6 0
3 years ago
A(n) blank______ model is a plan that details how a company creates, delivers, and generates revenues.
Lelechka [254]

A(n) blank Business model is a plan that details how a company creates, delivers, and generates revenues.

<h3>What exactly is a business model?</h3>

An organization's conceptual framework, which includes its mission, objectives, and continuing strategies for accomplishing them, is known as a business model.

A business model is essentially a specification outlining how a company achieves its goals.

<h3>A successful business model is what?</h3>

As an illustration, Clay Christensen of Harvard Company School proposes that a business model should include four components: a customer value proposition, a profit formula, essential resources, and key procedures.

Learn more about Business model :

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#SPJ4

6 0
2 years ago
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