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Leona [35]
2 years ago
8

Steady Company’s stock has a beta of 0.20. If the risk-free rate is 6% and the market risk premium is 7%, what is an estimate of

Steady Company’s cost of equity?
Business
1 answer:
777dan777 [17]2 years ago
5 0

Answer:

the estimation of the cost of equity is 7.4%

Explanation:

The computation of the estimation of the cost of equity is shown below:

Here we used the Capital Asset Pricing model formula i.e.

Cost of equity = Risk free rate + Beta × market risk premium

= 6% + 0.20 × 7%

= 6% + 1.4%

= 7.4%

Hence, the estimation of the cost of equity is 7.4%

We simply applied the above formula so that the correct value could come

And, the same is to be considered  

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3 years ago
To whom must licensees provide agency disclosures prior to entering into an agency agreement?
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6 0
1 year ago
Which of the following are the three characteristics that an advertising appeal should have? A. humorous, memorable, and interes
mihalych1998 [28]

Answer: (E) Meaningful, believable, and distinctive

Explanation:

  The advertising appeal is one of the type of communication process in which the the various types of organizations and the companies using this business strategy for promoting their brands and the products in the market.

 The main objective of the advertising appeal is to creating awareness and inform customers or users about the new brands, various types of products and the services in the market.  

 According to the given question, there are mainly three type of characteristics of the advertising appeal that are as follows:

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 The main aim of the meaningful characteristic is to make the product more interesting to the customers by highlighting its various types of meaningful advantages. Distinctive makes the product unique from all the products available in the market and believable appeal ensure the customer about the accurate delivery of the products.

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6 0
3 years ago
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5 0
3 years ago
Read 2 more answers
Beautiful Lawns Company estimates its doubtful accounts by aging its accounts receivable and applying percentages to various age
mr_godi [17]

Answer:

$3,000

Explanation:

Calculation to determine How much bad debts expense will Beautiful Lawns report in 2016

Using this formula

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Let plug in the formula

Bad debts expense=$3,600-$600

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Therefore The amount of bad debts expense that Beautiful Lawns will report in 2016 is $3,000

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