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Art [367]
3 years ago
11

BDE Inc. is an unlevered firm which expects to generate a net cash flow of $25 million per year in perpetuity. The firm’s requir

ed return on equity is 10%. Assume that the Modigliani and Miller assumptions hold. (15 points) For questions 27 and 28 assume that the corporate tax rate is zero. 27. What is the value of the unlevered firm?
Business
1 answer:
anzhelika [568]3 years ago
7 0

Answer:

$250 million

Explanation:

If taxes do not exist and the firm has no outstanding debt, then the value of unlevered firm = total enterprise value of BDE

we can use the perpetuity formula to determine the total enterprise value:

total enterprise value = FCF / cost of equity

total enterprise value = $25 million / 10% = $250 million

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Answer: Partnership

   

Explanation: In simple words, partnership refers to an agreement between two or more independent parties to join their forces for achieving a common business goal with the ultimate objective of earning profit.

In the given case,  Dan and Emily were sole proprietors and now they are joining their forces also the case states their new entity will not be a separate entity and both of the owners will be having unlimited debt.

Hence from the above we can conclude that this is a partnership business.

3 0
3 years ago
During the period, labor costs incurred on account amounted to $175,000, including $150,000 for production orders and $25,000 fo
amid [387]

Answer:

To recognize the Actual costs linked to production

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3 years ago
When reagan took office, he brought with him a new economic philosophy. with the guidance of his economic advisors, he tried to
Natali [406]

The nation’s <u>deficit rose </u>greatly as<u> inflation</u> and <u>unemployment</u> <u>fell</u> was an economic concern that was related to the achievement described in the passage.

<h3>What were the economic concerns in the passage? </h3>

The passage explains that with the fall in tax revenue of the government and higher spending on<u> employment programs</u>, the federal deficit started to rise.

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Learn more about economic concerns here:

brainly.com/question/10203871

4 0
2 years ago
What is a keyword outline
AleksAgata [21]
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4 0
3 years ago
Read 2 more answers
Kimbeth Manufacturing uses process costing to control costs in the manufacture of Dust Sensors for the mining industry. The foll
larisa86 [58]

Answer:

DM Cost per Equivalent unit: 4.25

Explanation:

22400 beginning  60% materials 20% conversion

140,000 started

33600 ending 90% materials 40% conversion

Beginning Inventory

DM 71,160

DL 26,610

MO 20,110

Conversion Cost  46,720

Cost during the month

DM 618,800

DL 241,330

MO 513,600

Conversion Cost 754,930

Equivalent units Materials

22,400 * .4     8,960

140,000       140,000

33,600 * .1    (3,360)

                  145,600

DM Cost per Equivalent unit: 4.25

7 0
4 years ago
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