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zvonat [6]
3 years ago
10

Sallie's Sandwiches​Sallie's Sandwichesis financed using 20% debt at a cost of 8%. Sallie projects combined free cash flows and

interest tax savings of $2 million in Year 1, $4 million in Year 2, $5 million in Year 3, and $117 million in Year 4. (The Year 4 value includes the combinedhorizon values of FCF and tax shields.) All cash flows are expected to grow at a 3% constant rate after Year 4. Sallie'sbeta is 2.0, and its tax rate is 34%. The risk-free rate is 8%, and the market risk premium is 4%. Using the data for Sallie's Sandwiches andthe compressed adjusted present value model, what is the total value (in millions)? Group of answer choices$72.37 $73.99 $74.49 $75.81 $76.45 Quizlet
Business
1 answer:
JulijaS [17]3 years ago
8 0

Answer:

$76.45

Explanation:

Sallie Sandwiches used hybrid financing which means debt and equity both are used to finance business. The company's cost of financing will be;

Cost of debt : 8% + [ 2.0 * 4%] = 16%

Cost of financing : [0.2 * 8%] + [0.8 * 16%] = 14.4%

NPV discounted at 14.4% is $76.45

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The three steps which will create triangular arbitrage profit are as follows: first step, convert ____; second step, convert ___
Vladimir [108]

Answer:

The correct option is b) USD to GBP; GBP to CHF; CHF to USD.

Explanation:

A triangular arbitrage can be described as the act of taking advantage of a foreign exchange market arbitrage opportunity created by a pricing difference between three different currencies.

A triangle arbitrage method entails three deals, with the first currency being converted to a second, the second currency being converted to a third, and the third currency being converted to the first.

In the question, USD is the first currency, GBP is the second currency, and CHF is the third currency. Based on the explanation above, the three steps which will create triangular arbitrage profit are as follows: first step, convert <u>USD to GBP</u>; second step, convert <u>GBP to CHF</u>, and third step, convert <u>CHF to USD</u>.

Therefore, the correct option is b) USD to GBP; GBP to CHF; CHF to USD.

7 0
3 years ago
Tom is trying to quit smoking. His parents, siblings, wife, children, and his doctor have all emphasized to him how important it
4vir4ik [10]

Answer:

perceived behavioral control

Explanation:

According to my research on the theory of planned behavior, I can say that based on the information provided within the question the factor most likely to interfere with Tom quitting smoking is his perceived behavioral control. This is defined as the individuals perception of believing whether or not a behavior is within their control. If Tom does not believe quitting smoking is in his control, then he will not be able to quit regardless of how many people tell him how important it is to do so.

I hope this answered your question. If you have any more questions feel free to ask away at Brainly.

5 0
4 years ago
Read 2 more answers
Bakers are much ___________ likely to supply pastries to the market if property rights are not enforced. In the presence of mark
Gwar [14]

Answer: more; externality; market power.

Explanation:

Bakers are much (more) likely to supply pastries to the market if property rights are not enforced.

a. A manufacturing plant dumps chemical waste into a nearby river, poisoning the water supply for a small town downstream. - Externality

Externality, refers to the benefit s or costs that someone else incurs based on the economic decision of another person. In this case, this is a negative externality as the small town bears the cost of the production activities of the company.

b. A single public utilities company is responsible for supplying electricity for an entire state. As a result, the utilities company can set the price of electricity - Market power

Market power is when a firm is able to dictate the price and can then raise the price. This brings about the reduction in output as well. Since the single public utilities company is responsible for supplying electricity for an entire state, the company is enjoying monopoly power or market power.

8 0
3 years ago
A professor hypothesizes that there will be a relationship between couples' listening skills and length of marriage. she has a _
Kaylis [27]

The professor has constructed a hypothesis. This answer takes from the first statement mentioning how the professor predicts a relationship between two variables. A hypothesis can be used to make a statement that predicts a relationship or solve a certain phenomenon. It must be based off by facts and solid information. 

4 0
3 years ago
An example of a loan that tends to have a lower interest rate is a(n) __________ loan.
Setler79 [48]
The answer is : A. Home loan

Home loan only have about 4 -5 % interest rate. Compared to other options :

- Credit Card Loan : about 15 %  of interest rate
- Paycheck Loan : also about 15 % of interest rate
- Unsecured Loan : usually above 20 % interest rates


6 0
3 years ago
Read 2 more answers
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