Answer and Explanation:
The computation is shown below:
Debt = D ÷ (E + D)
= 0.8 ÷ (1 + 0.8)
= 0.4444
Now
Weight of equity = 1 - Debt
= 1 - 0.4444
= 0.5556
As per Dividend discount model
Price = Dividend in 1 year ÷ (cost of equity - growth rate)
40 = $2 ÷ (Cost of equity - 0.06)
Cost of equity = 11%
Cost of debt
K = N
Let us assume the par value be $1,000
Bond Price =∑ [(Annual Coupon) ÷ (1 + YTM)^k] + Par value ÷ (1 + YTM)^N
k=1
K =25
$804 =∑ [(7 × $1000 ÷ 100)/(1 + YTM ÷ 100)^k] + $1000 ÷ (1 + YTM ÷ 100)^25
k=1
YTM = 9
After tax cost of debt = cost of debt × (1 - tax rate)
= 9 × (1 - 0.21)
= 7.11
WACC = after tax cost of debt × W(D) + cost of equity ×W(E)
= 7.11 × 0.4444 + 11 × 0.5556
= 9.27%
As we can see that the WACC is lower than the return so it should be undertake the expansion
Answer:
Workforce diversity challenges, technological challenges, and economic challenges
Explanation:
The challenges (trends) Consolidation Tech Plus (CTP), Inc. Should be aware of in the environment of human resource management that require HR to play a more central role in this growing organization are :
Workforce diversity challenges includes Acceptance and Respect, Accommodation of Beliefs ,Ethnic and Cultural Differences,
Gender Equality among others
Technological challenges includes Information security, Risk management and governance,
Regulatory compliance, Technology integration and upgradation, Resource management among others
Economic challenges includes Conflict and Poverty, Competing in a New Era of Globalization,Global Imbalances,Rise of New Powers among others
Answer:
The answer is B.
Explanation:
In purely competitive firms, there are many buyers and sellers that no single buyer or seller can influence the price of goods. They accept the price set by the market conditions which depend on the market supply and demand. Firms in this market are price-takers.
In monopolistic firm, no one is competing against him. He is the only one in the industry. He is the only seller while buyers are many. In most cases, buyers do not have alternative than to buy the product. Because of this, the firm in monopoly sets its price. He is a price-maker.
I believe the correct answer is the first option. The labor supply curve is upward sloping because the opportunity cost of leisure decreases as wages decrease and the opposite of such is true as well. As one work one hour more, one will have less time for other activities. As the work rate increases in value, then the opportunity cost increases as well.
Answer:
The correct answer is option c.
Explanation:
An oligopoly market is a form of imperfect competition where there are a few firms. These firms can produce identical or differentiated products. Because of a few firms in the market, there is a high degree of competition in the market.
These firms are interdependent such that the economic decisions of a firm affect its rivals. So each firm has to consider the reaction of its rivals before making decisions.
The firms are price makers and face a downward-sloping demand curve.
