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Sergio [31]
3 years ago
14

Take It All Away has a cost of equity of 10.54 percent, a pretax cost of debt of 5.27 percent, and a tax rate of 35 percent. The

company's capital structure consists of 68 percent debt on a book value basis, but debt is 28 percent of the company's value on a market value basis. What is the company's WACC?
Business
1 answer:
bogdanovich [222]3 years ago
6 0

Answer:

9%

Explanation:

WACC is the average cost of capital of the firm based on the weightage of the debt and weightage of the equity multiplied to their respective costs.

According to WACC formula

WACC = ( Cost of common stock x Weightage of common stock ) + ( Cost of preferred stock x Weightage of preferred stock ) + ( Cost of debt ( 1- t) x Weightage of debt )

As WACC is calculated using Market values.

Company Value = 100%

Value of Debt = 28%

Value of Debt = 100% - 28% = 72%

WACC = ( 10.54% x 72% ) + ( 5.27% x 28% )

WACC = 7.59% + 1.48%  = 9.07% = 9% (rounded off)

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1. A simple random sample of size 15 is drawn from a normal population whose standard deviation is assumed to be 8. What's the m
WINSTONCH [101]

Answer:

± 4.05

Explanation:

Data provided in the question:

Random sample size = 15

Standard deviation = 8

Confidence level = 95%

Now,

Margin of error is given as:

Margin of error = ± [ ( z × s ) ÷ √n ]

Here,

From standard z table for 95% confidence level z = 1.96

Margin of error = ± [ ( 1.96 × 8 ) ÷ √15 ]

or

Margin of error = ± [ 15.68 ÷ 3.873 ]

or

Margin of error = ± 4.05

7 0
3 years ago
Jarvis Company produces a product that has a selling price of $25 and a variable cost of $17 per unit. The company's fixed costs
Sholpan [36]

Answer:

The break-even point measured in sales dollars is $8

6 0
2 years ago
Which fire team member is responsible for covering dead space?
mestny [16]
I believe the answer is <span>Grenadier
Dead space refers to the area that couoldn't be observed by the military group,
</span><span>Grenadier played the role to to create explosion during assault operation by throwing out grenades to the dead space in order to eliminate potential enemy that hide in that area.</span><span>
</span>
8 0
3 years ago
Suppose the price of university sweatshirts increases from $10 to $20 and the quantity supplied increases from 20 to 30. The pri
riadik2000 [5.3K]

Answer:

0.60

Explanation:

The midpoint formula is used to calculate elasticity by using average percentage in both price and quantity.

The formula is given below:

Percentage change in quantity =<u>  (Q2 -Q1)     </u>   x  100

                                                        (Q2 + Q1) / 2

Percentage change in price = <u> (P2 -P1)     </u>   x  100

                                                   (P2 + P1) / 2

Elasticity =<u> Percentage change in price__</u>

                 Percentage change in quantity

Inserting the data:

Percentage change in quantity =<u> (30  -20)    </u>  x  100  =    <u>10</u> x 100  = 40%

                                                       (30 + 20) /2                   25

Percentage change in price  = <u>($20 - $10)</u> x 100    =  <u>10</u>  x 100   =  66.6%

                                                    ($20 + $10) /2             15

Elasticity of supply = <u>40%</u>

                                  66.6%

                                  = 0.60

                                           

3 0
3 years ago
Business writers prefer simple, informal words that are readily understood and less distracting than more difficult, formal word
Daniel [21]

Answer:

The statement is: False.

Explanation:

Business is one of the fields that require paperwork and reports to be transmitted seriously because of the type of information handled. <em>Inflation rates, the annual Gross Domestic Product (GDP) </em>or <em>a country's economic policy</em> are typical topics dealt in this field. For that reason, business writers <em>must be formal</em> without being afraid of using technical terminology where necessary.

5 0
3 years ago
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