Answer:
The correct answer is False.
Explanation:
Net working capital, or "Working Capital" is simply the difference between current or current assets and current or short-term liabilities of a company.
Cash flow, on the other hand, is the net amount of cash and its equivalents that is transferred inside and outside the company and that may originate in operational, investment or financing activities.
Cash flow will have an operational origin, when there is a net decrease in working capital. In this situation there will be a net cash release that the company can use freely to honor debts, reinvest in operations, pay dividends, cover expenses or provide funds for future investments.
A negative cash flow, from the point of view of operations, implies that the company has increased its cash demands to finance sales on credit or inventory. That is, it has increased its investment in working capital. Situation that will require an analysis that allows a better way to manage capital.
Here, public savings = $1.05 billion and private savings = $3.15 billion
It is calculated as follows:
Total savings, S = $4.20 billion
We know: S = V+U
It means National Savings = Private savings + Public savings
Here:
V = private savings , U = public savings and
Private saving, V = 0.75 × S
= 0.75 × $4.20 billion
= $3.15 billion
And, the public savings will be = National savings - private savings
= $4.20 billion - $3.15 billion
= $1.05 billion
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Answer:
government corporation
Explanation:
A government corporation is a government-owned firm that operates with the same integrity as a private company, except that the owner is government. Every government company is chartered by legislative act. Government corporations are typically created in markets where there is a natural monopoly, they are significant to the country's infrastructure, natural resources, and general public interest.
Answer:
9.315%
Explanation:
The computation of WACC is shown below:-
But before that we need to do the following calculations
PV -$1,000
PMT 80
N 20
FV $1,000
Compute IY 8%
After tax cost of Debt = Before tax cost of debt × (1 - tax rate)
= 8% × (1 - 25%)
= 6%
According to the CAPM,
Cost of Equity =Risk free Rate + (Beta × Market Risk Premium)
= 4.5% + (1.2 × 5.5%)
= 11.10%
Weight of Equity = 100% - 35%
= 65%
WACC = (Weight of Equity × Cost of Equity) + (Weight of debt × Cost of debt)
= (65% × 11.10) + (35% × 6)
= 9.315%
Answer:
The marginal propensity to save is 0.4
Explanation:
The marginal propensity to save is 1 - marginal propensity to consume.
The marginal propensity to consume is the proportion of an increase in income that the consumers will spend from this increased income and the marginal propensity to save is the proportion of the increase in income that will be saved.
The marginal propensity to consume (MPC) = Change in consumption / change in income
The MPC = (2100 - 1500) / (3000 - 2000) = 0.6
Thus, the marginal propensity to save is 1 - 0.6 = 0.4
