Answer:
They are too restrictive in economic freedom
Explanation:
Make money for the government
Answer: 10 years to call
Explanation:
Maturity period = 25 years
Coupon rate = 7%
6.25% basis is,
- Callable in 10 years at 103
- Callable in 15 years at 102
- Callable in 20 years at par
This bond is considered as premium bond. Therefore, in case of premium bonds, Yield to call will be lower than the yield to maturity. Here, the question is which call date should be utilized. According to the rule of thumb, it states that always use the term that is nearest to the whole call date.
Hence, on the customer's confirmation, the dollar price quoted must be based on 10 years to call.
Answer:
D)the research and development costs to produce the current winter footwear samples.
Explanation:
Research and development costs associated with the current winter footwear samples will not impact the performance of the proposed new line.
When analyzing the viability of the new product line up, the company should only consider the projected expenses and revenues arising from the project. A project is viable if its benefits outweigh its shortcomings. One way of establishing viability is by doing a cost-benefit analysis.
For the Shoe Box company, the new project line may have some effects on the sales of current products. The new projects will demand new counters. The company must also consider expected revenues and taxes. All these have elements of cost and benefits directly associated with the proposed product line.
Answer:
12.085 %
Explanation:
WACC = Cost of Equity x Weight of Equity + Cost of Preference Stock x Weight of Preference Stock + Cost of Debt x Weight of Debt
Remember to use the after tax cost of debt :
after tax cost of debt = interest x ( 1 - tax rate)
= 8.00 % x (1 - 0.35)
= 5.20 %
therefore,
WACC = 22.00 % x 0.40 + 8.50 % x 0.05 + 5.20 % x 0.55
= 12.085 %
thus
the firm's WACC given a tax rate of 35 percent is 12.085 %
