A certificate of deposit (CD) would be the best banking
choice when the interest rate is determined ahead of time and there is an
assurance to get back what you put in plus interest once the CD matures. If you leave the money alone during the
investment period then the bank will pay you an interest rate slightly higher
than what you would have earned in a money market or checking account. Thus,
all gains from certificate of deposits are taxable as income unless they are in
a tax-deferred (IRA) r tax-free (Roth IRA) account.
Answer:
13.54%
Explanation:
Debt Equity Ratio (Debt/Equity)=0.57
Yield to Maturity (YTM) on bonds (Cost of Debt) (Kd) = 11%
Cost of Equity (Ke) = 17%
Income Tax Rate= 32%
Computation of WACC
Particulars Proportion (1) Cost (2) Weighted Cost (1*2)
Equity 0.6369 17 10.8273
Bond (Debt) 0.3631 7.48 <u>2.7160</u>
Total 1 <u>13.5433</u>
Therefore, the WACC of Company= 13.54%
<u>Working Note 1</u>
<u>Computing Proportion</u>
Debt/Equity=0.57
Therefore Debt= 0.57 Equity
Lets assume Equity = 10
So Debt = 5.7
Hence, Proportion is as follows:
Equity= 10/15.7 =0.6369
Debt= 5.7/15.7 = 0.3631
<u>Working Note 2</u>
After tax cost of Debt = 11 * (1 - 0.32)
After tax cost of Debt = 11 * 0.68
After tax cost of Debt = 7.48%
<span>The demand curve for corn depends on what market it is needing it. If corn is needed for food for humans or for animals and if the need is normal or in addition to a current or outstanding reason makes a difference.</span>
If the quantity of real domestic output demanded increased by $1,000 at each price level, then, according to macroeconomics, the new equilibrium price level and quantity of real domestic output would be 150 and $4,000.
<h3><u>
What is macroeconomics?</u></h3>
- Macroeconomics is a subfield of economics that focuses on the behavior of an economy as a whole, including the market and other large-scale processes.
- Inflation, price levels, economic growth rates, national income, gross domestic product (GDP), and variations in unemployment are only a few examples of the phenomena that macroeconomics analyzes.
- Macroeconomics makes an effort to assess how well an economy is operating, comprehend the forces that shape it, and predict how performance could increase.
- In contrast to microeconomics, which focuses primarily on the decisions made by individual economic actors, macroeconomics examines the functioning, structure, and behavior of the entire economy (like people, households, industries, etc.).
Curves of supply and demand cross at the equilibrium price. We would forecast that the market will function at this pricing.
Know more about macroeconomics with the help of the given link:
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Answer:
$4,800,000
Explanation:
Widget corporation purchased all of its fixed assets three years ago for $6 million
These assets can be sold today for $3 million
The company receives $1.8 million in cash after liquidation of current assets
Therefore the market value of the company's total assets today can be calculated as follows
Market value = $3,000,000 + $1,800,000
= $4,800,000
Hnence the company's market value for today is $4,800,000
