Answer:
The market value of Lotle Group is $ 83.53.
Explanation:
The market value of Lotle Group can be calculated by dividing the perpetual net operating income (EBIT) with company WAAC. Detail calculation is given below.
MW = EBIT/WAAC = $ 9/10.775% = $ 83.53
<u><em>WAAC Calculation</em></u>
WAAC = 14%*(50/80)% + 9%(0.60)(30/80)
WAAC = 8.75% + 2.025% = 10.775%
Based on the interest rate given, the deal that was tossed by the quarterback will be $107.36 million.
<h3>What is an interest rate?</h3>
It should be noted that an interest rate simply means the amount that's charged by a lender. It's a percentage of the principal.
In this case, since the interest rate has been given, the kind of deal that was tossed will be:
= (3.5 + 7.6/1.11) + 18.6)1.11² + 25.2/1.11³ + 25.5)/1.11⁴ + 25.6/1.685
= 107.34 million
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Answer:
(B) U(c,f)=min{2c,f}
Explanation:
This is an example of Leontif utility function which states that the preferences of a consumer is to a constant ratio of quantities of two or more goods in his demand bundles and having an extra unit of a single good will not increase the utility of the consumer and will make the extra unit to waste. But having more units of all the goods in the demand bundle which maintain the constant ratio will increase the utility of the consumer.
A good example usually used in economics is that of a pair of shoe. Having one right and one left of a type of shoe gives a consumer utility at a constant ratio of 1:1, and increasing each leg by multiple of one at every point in time will increase the utility of the consumer, while increasing just only one makes the utility not to change. For instance, having only two left shoe will not give the consumer any utility and make both the left shoe useless.
In the question, the ratio of cups of corn meal, denoted by c, and cups of flour, denoted by f, is 2:1. This implies that to increase the utility of the consumer, c has to increase by a multiple of 2 at every point in time while f has to increase by one at the same point in time to maintain the constant ratio of 2:1. Increasing only c by 2 or only f by 1 will maintain the constant ratio and it will lead to a waste of the increased unit of the affected commodity.
Therefore, option (B) U(c,f)=min{2c,f} is the correct answer that gives a constant ratio of 2:1 = 2c:f.
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What is true about credit unions is that <span>they are generally member-owned.
</span>Even in the definition of a credit union it says that:
<em>A credit union is a member-owned financial cooperative, democratically controlled by its members, and operated for the purpose of promoting thrift, providing credit at competitive rates, and providing other financial services to its members - </em>taken from Wikipedia.
Answer:
For Jerry, the opportunity cost of building a fence is not making 2 dishes.
Explanation:
The opportunity cost refers to the benefit you lose when you choose one option over another one. In this case, the opportunity cost for Jerry when he decides to build fences is that he won't be able to make dishes. So, as he can build 7 fences or make 14 dishes in a day, the opportunity cost of building a fence is that he won't be able to make 2 dishes.