All categories

3 years ago

Explain one advantage of using retained profit as a source of finance.

1 answer:

7 0

Retained profits have several major advantages: They are cheap (though not free) – effectively the "cost of capital" of retained profits is the opportunity cost for shareholders of leaving profits in the business (i.e. the return they could have obtained elsewhere)

You might be interested in

Southwestern Bank offers to lend you $50,000 at a nominal rate of 6.9%, compounded monthly. The loan (principal plus interest) m

san4es73 [151]

Answer:

0.98%

Explanation:

Note: Options provided is slightly different for this question

EAR = (1+APR/m)^m - 1

EAR = (1+0.069/12)^12 - 1

EAR = (1.00575)^12 - 1

EAR = 1.07122449517 - 1

EAR = 7.12%

Hence, higher EAR charged by Woodburn versus the rate charged by Southwestern = (8.1% - 7.12%) = 0.98%

5 0

3 years ago

If a person makes a deposit of 10,000 or more into a bank account the bank must notify the

ser-zykov [4K]

IRS - Internal Revenue Service/Federal Government.

8 0

3 years ago

A state whose fiscal year ends June 30, 2013, had the following transactions and events. For each item, compute how much total e

timurjin [86]

no en te

nasdfjajajajajajajjajajjajajajajjajajajajjajajajajjjav

8 0

3 years ago

In marketing and consumer research, the conative component of the tricomponent attitude model is frequently treated as an expres

Ilya [14]

Answer:

C. Intention to buy

Explanation:

Attitude simply represents behaviour which is learned that makes an individual respond either in a favourable or unfavourable way to a particular object. It could be a good, service, product among others. Attitude is important in determining consumer behaviour and it greatly affects marketing

The Tricomponent Attitude Model is one of four categories of attitude models usually considered in marketing. The model consists of 3 parts or components as follows

a. The cognitive component- deals with the perceptions and knowledge of consumers about services, products or brands

b. Affective component- this general measures or assesses the disposition of a consumer to a product and it measures as favourable or unfavourable

c. Conative component- This component of the tricomponent attitude mode is basically concerned with the consumer's intention to buy a particular product, patronise a brand or request a service.

7 0

3 years ago

Read 2 more answers

You are given the following data on US Treasury. The maturity date is May 15, 2041. The asked yield-to-maturity is 2.128%. The c

babunello [35]

Answer:

$1,035.84

Explanation:

Number of years to maturity (Nper) = 20

Annual Coupon payment (PMT) = 1000*2.35% =$23.50

Payment at maturity (FV) = $1000

Yield to maturity (Rate) = 2.13%

<em>Using the MsExcel Present value function</em>

Clean(flat) price = PV(Nper, PMT, FV, Rate)

Clean(flat) price = PV(20, 23.50, 1000, 2.13%)

Clean(flat) price = 1035.8436

Clean(flat) price = $1,035.84

5 0

3 years ago

Explain one advantage of using retained profit as a source of finance. ​

Explain one advantage of using retained profit as a source of finance.