I think the answer is B because that doesn't seem very desirable
Answer:
cost of capital 16%
Explanation:
SML formula:
r_f = 3%
β = 1.3
r_m = 13%
0.03 + 1.3(0.13-0.03)
firm's required return = .16 = 16%
Suppose that you deposit $4,500 in your bank and the required reserve ratio is 18 percent. The maximum loan your bank can make as a direct result of your deposit is 3690.
<h3>
What exactly is a bank loan and the required reserve ratio?</h3>
- A loan is a quantity of money that one or more people or businesses obtain from banks or other financial organizations in order to handle their finances in connection with anticipated or unforeseen circumstances.
- By doing this, the borrower creates a debt that must be repaid with interest within a predetermined time frame.
- The percentage of deposits that authorities mandate a bank maintain in reserves and refrain from lending out is known as the required reserve ratio.
- If the required reserve ratio is 1 to 10, a bank can only lend out $0.90 of every dollar it has on deposit, but it must retain $0.10 in reserves.
Hence, The maximum loan your bank can make as a direct result of your deposit is 3690.
To learn more about the loan, refer to the following link:
brainly.com/question/25599836
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Answer:
option (B) 25,000
Explanation:
Data provided in the question:
Fixed cost = $500,000 per year
Cost of wood and labor to manufacture one bat = $5
Selling price of the bat = $25
Now,
At breakeven, total cost equals to the total revenue
let the breakeven quantity be 'x'
thus,
$500,000 + $5x = $25x
or
$25x - $5x = $500,000
or
$20x = $500,000
or
x = 25,000
Hence,
the correct answer is option (B) 25,000
