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IrinaK [193]
3 years ago
11

Alternative A has a rate of return of 14% and Alternative B has a rate of return of 17%. If the investment required in B is larg

er than that required for A, the rate of return on the increment of investment between A and B is
Business
1 answer:
charle [14.2K]3 years ago
8 0

Answer:

The answer is "larger than 17%".

Explanation:

Assume the sum of investment as B is more than A:

In part A:  

                                                                        A                    B           Increment

Purchase(assumed)                                          100              150                   50  

Departure Rate                                                   14%              17%                

Return                                                                 14                25.5               11.5      

The rate of return increases( \frac{11.5}{50} \times 100)                                                       23      

In part B:  

                                                                         A                    B           Increment

Purchase(assumed)                                          100              120                   20  

Departure Rate                                                  14%              17%                

Return                                                                 14                20.4               6.4      

The rate of return increases( \frac{6.4}{20} \times 100)                                                        32      

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Carmen Co. can further process Product J to produce Product D. Product J is currently selling for $23.70 per pound and costs $15
Oxana [17]

Answer:

$9.75

Explanation:

the contribution margin of product J = $23.70 - $15.65 = $8.05

the contribution margin of product D = $43.65 - ($9.75 + $15.65) = $18.25

the differential cost of producing product D is equal to the additional cost incurred by further processing product J = $9.75

differential costs or expenses are the difference in costs resulting from choosing one activity over another, or like in this case, further processing one product into another.

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According to the marketing concept, while customer satisfaction is the main goal, it is also important that a business achieve i
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4 years ago
Central Systems desires a weighted average cost of capital of 12.7 percent. The firm has an aftertax cost of debt of 4.8 percent
Anon25 [30]

Answer:

Debt-equity ratio = 0.34 or 34%

Explanation:

Weighted average cost of capital (WACC) = 12.7%

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The weighted average cost of capital is given by

WAAC = 0.154*W_e +0.048W_d\\0.127 = 0.154*W_e +0.048*(1-W_e)\\0.079 = 0.106W_e\\W_e=0.745\\W_d = 1-0.745=0.255

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7 0
3 years ago
Suppose the following transactions occur during the current year:1. Jacques orders 50 bottles of wine from a French distributor
denis23 [38]

Answer:

$9,000

Explanation:

Step 1: Calculation of the total amount of each transaction

1. Jacques' bottles of wine = 50 × $30 = $1,500

This is an import since Jacques orders the bottles of wine from a French distributor.

2. A U.S. company textbook sales = 200 × $45 = $9,000

This is an export since a U.S. company sells the textbooks to a Canadian company.

3. Musashi's laptop = $1,500

This a consumption or domestic spending since it is a U.S. citizen that orders the laptop from a U.S. company

Step 2: Calculation of combined effect on the US national accounts this year

We use the following national accounts equation:

GDP = C + I + G + (X - M)  .................................. (1)

Where;

GDP = Gross Domestic Product = ?

C = Consumption or domestic spending = $1,500

I = Investment = 0

G = Government expenditure = 0

X = Exports - $9,000

M = Imports - $1,500

(X - M) = Net Exports = $9,000 - $1,500 = $7,500

Substituting the values into equation (1), we have:

GDP = $1,500 + 0 + 0 + $7,500 = $9,000.

Therefore, the combined effect of these transactions on the US national accounts for the current year is a contribution of $9,000 to the GDP.

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4 years ago
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