Answer:
C. Reject W
Explanation:
In this question, we apply the Capital Asset Pricing Model (CAPM) which is shown below:
Expected return = Risk-free rate of return + Beta × (Market rate - Risk-free rate of return)
= 7% + 1.6 × (12%-7%)
= 7% + 1.6 × 5%
= 7% + 8%
= 15%
The Project W should be rejected as it gives only 14% expected return which is less than the derived expected return.
Answer:
The answer is "4,750"
Explanation:
They have indeed been given the information that we require.
The current market cap for Simon Company (SIMON) is $300,000.
rate= 6%
EBIT=$150,000
The business has no plans to expand.
The current cost of capital is 8.8%,
The tax rate is 40%.
The company has 10,000 shares of common stock mostly on market.
The stock is being offered at a $90.00 per share price.
Assume SIMON is considering switching in its current financial performance to one that results in a share price of $96 per share.
The resultant capital structure would have a combined valuation of $504,000 in capital and $756,000 in equity.
Remaining Shares= equity market value / per share price
The initial number of shares minus the resultant number of shares equals the number of repurchased shares:
AJC will buy back a certain number of shares.
This is an example of a strength based selection system. It offers a different perspective on the labor pool.
Answer:
d) $3,920
Explanation:
The computation of the borrowed amount is shown below:
= Beginning cash balance + expected cash receipts - expected cash disbursements - minimum monthly cash balance
= $5,480 + $56,200 - $60,600 - $5,000
= $3,920
We easily add to the starting cash balance the estimated cash receipts and deducted the expected cash disbursements and the minimum monthly cash balance, in order to get the correct value
Answer: smaller pipe
Explanation: for the first alternative that is constructing with bid size pipe which cost total of $115 million throughout the 50 years and a pumping cost which cost $25000 less than the smaller pipe for the next 16 years of which after those years, it will be equal.
While the smaller pipe cost $65million + $100million = $165million then plus the pumping cost which is equally higher than the big pipe cost . Already there is a difference in cost(minus pumping cost)= $165-115= $50million.
And then $25,000 *16 years= $400000 .
So the total difference in cost for the first 16 years is $50.4 million.
So now with interest rate of 8% you'll see that much capital is used in the smaller pipe , so if both pipe system receive interest rate of 8%, the smaller pipe will have more interest than the bigger.
