Answer:
its weighted cost of capital for the coming year is 9.64%
Explanation:
WACC is the minimum return expected from a project. It shows the risk of the company.
<u>Calculation of WACC.</u>
Capital Source Weight Cost Total
Debt 40% 6.60% 2.64%
Common Equity 60% 11.67% 7.00%
Total 100% 9.64%
Cost of Debt = Market Interest Rate × ( 1 - tax rate)
= 11%×(1-0.40)
= 6.60%
Cost of Equity = (Next year`s dividend/Current Market Price of a share)+Expected growth rate
= ($1.40/$30)+0.07
= 11.67%
It would actually be an increased production by the business.
Haha, I had to think for a tiny bit and re-check my answer to make sure it was right before giving it. Would hate to see you get it wrong.
Answer:
Realized gain of Shontelle = $332000
Explanation:
given data
adjusted basis = $760,000
mortgage = $192,000
receives cash = $120,000
fair market value = $780,000
to find out
What is Shontelle realized gain or loss
solution
we find here first Realized gain that is express as
Realized gain = Amount realized - Adjusted basis ..................1
so here Amount realized = (receives cash + fair market value + mortgage)
Amount realized = (120000 + 780000 + 192000)
Amount realized = 1092000
so from equation 1
Realized gain = Amount realized - Adjusted basis
Realized gain = 1092000 - 760000
Realized gain = $332000
so we can say that
Realized gain of Shontelle = $332000
Answer:
$100 million ; $10 million
Explanation:
Required reserve ratio (r) = 10%
Worth of bond = $10,000,000
The smallest increase can be thought of as being the $10million generated from open market operation and could be held by the bank as reserve.
To calculate the largest increase in deposit:
Money multiplier * deposit (worth of bond)
Money multiplier = (1 / reserve ratio)
Money multiplier = (1 / 0.1) = 10
Increase in deposit = 10 * $10,000,000 = $100,000,000 ( $100 million)
