The Income Statement for Pumpkin Co. is shown below:

You are considering investing in a GM bond with 7 years to maturity. The face value of the bond is $1,000. The coupon rate is 6%

Lapatulllka [165]

Answer:

Price of bond is = $ 1057

Explanation:

As we know that;

Price of bond = C * [1-(1+r)∧-n] / r + F / (1+r)∧n

where C = periodic coupon payment = 1000 * 6%= 60

F = Face value of bond = 1000

r = yield to maturity = 5% = 0.05

n = number of periods till maturity = 7 years

Putting values;

= 60 * [ 1- (1+ 0.05)∧-7 ]/ 0.05 + 1000 / (1+0.05)∧7

= 60 * (0.2893 / 0.05) + 710

= 60 * 5.786 + 710

= 347.16 +710

= 1057

6 0

3 years ago

You are the manager of a popular hat company. You know that the advertising elasticity of demand for your product is 0.25. How m

Inessa [10]

Answer:

20%

Explanation:

if the advertising elasticity = 0.25 and you want to increase the quantity demanded by 5%, you will need to increase advertisement by = 5 / 0.25 = 20%

The advertising elasticity measures how much does a change in advertising changes the quantity demanded of a product or service.

3 0

3 years ago

Bermuda Cruises issues only common stock and coupon bonds. The firm has a debt–equity ratio of .75. The cost of equity is 11.6 p

raketka [301]

Answer:

the capital structure weight of the firm's equity will be 57.14 %.

Explanation:

Weighted Average Cost of Capital is the return that is required by the providers of long term sources of finance.

A debt–equity ratio of 0.75 means:

Debt : Equity = 0.75 : 1

The Total Ratio will be = 0.75 + 1.00

= 1.75

Therefore, the capital structure weight of the firm's equity will be :

Equity Weight = Equity Ratio ÷ Total Ratio

= 1.00 ÷ 1.75

= 0.5714 or 57.14 %

7 0

3 years ago

A foodborne pathogen that can cause meningitis is _____.

jekas [21]

Answer:

C. Listeria monocytogenes

Explanation:

Meningitis is an infectious disease caused by the infection of meninges by virus or bacterial. This can lead to confusion, vomiting, depression etc.

When food that has been contaminated by a pathogen called listeria monocytogenes is consumed, it can develop into meningitis. Meningitis can be treated and controlled by the use of antibiotics, and in some cases the combination of two or more types may be required depending on the nature of infection.

7 0

3 years ago

Pharoah Incorporated factored $154,700 of accounts receivable with Engram Factors Inc. on a with recourse basis. Engram assesses

VashaNatasha [74]

Answer:

Cash 135,604 debit

Due from factor account: 7,735 debit

Loss on Factoring 18,081 debit

Recourse Liability 6,720 credit

Accounts Receivable 154,700 credit

--to record sales of account receivables--

Explanation:

fee: 154,700 x 3% = 4,641

retention: 154,700 x 5% = 7,735

recourse: 6,720

The company will receive cash for the difference between his account receivable and the discount above:

154,700 - 4,641 - 7,735 - 6,720 = 135.604‬

We post the retention as an assets as latter we will recove this amount.

Then, the recourse as a liaiblity. Write-off the receivables and later, the cash receipts.

The difference will be considered a loss.

5 0

3 years ago