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Archy [21]
2 years ago
6

An investment has the following characteristics: ATIRRP: After-tax IRR on total investment in the property: 9.0% BTIRRE: Before-

tax IRR on equity invested: 17% BTIRRP: Before-tax IRR on total investment in the property: 12% t: Marginal tax rate: 0.40 What would be the break-even interest rate (BEIR), at which the use of leverage is neither favorable nor unfavorable
Business
1 answer:
pshichka [43]2 years ago
5 0

Answer:

15%

Explanation:

Calculation to determine would be the break-even interest rate (BEIR)

Using this formula

Break-even interest rate (BEIR)= After tax IRR on total investment / (1- Tax rate)

Let plug in the formula

Break-even interest rate (BEIR)=9% / (1-0.40)

Break-even interest rate (BEIR)=9%/0.60

Break-even interest rate (BEIR)= 15%

Therefore would be the break-even interest rate (BEIR), at which the use of leverage is neither favorable nor unfavorable is 15%

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Burka [1]

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4. True. They do.

5. False. It's the other way around.

8 0
3 years ago
1.Describe the role that workers play in the game of economics.
antoniya [11.8K]
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3 years ago
If you put up $43,000 today in exchange for a 6.25 percent, 15-year annuity, what will the annual cash flow be?
AysviL [449]

Answer:

The annual cash flow will be $4,500.

Explanation:

Use following formula to calculate Annual Cash flow from Annuity.

Present value of annuity = annual cash flow ( 1 - ( 1 / ( 1 + rate of interest )^time period ) ) / rate of interest

PVA = C ( 1 - ( 1 / ( 1 + r )^t ) ) / r

$43,000 = C ( 1 - ( 1 / ( 1 + 0.0625)^15 ) ) / 0.0625

$43,000 = C x 9.5555

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3 years ago
The first entry to liquidate a partnership would probably include
Lorico [155]
Property will not added when it liquidate
8 0
3 years ago
Read 2 more answers
Board of directors of 'Fairdeal limited' has formulated a policy for human resources development. According to this policy, cert
BigorU [14]

Answer:

Internal employment source

Explanation:

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