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ale4655 [162]
3 years ago
5

Wilde Software Development has a 12% unlevered cost of equity. Wilde forecasts the following interest expenses, which are expect

ed to grow at a constant 3% rate after Year 3. Wilde's tax rate is 25%. Year 1 Year 2 Year 3 Interest expenses $80 $95 $140 What is the horizon value of the interest tax shield
Business
1 answer:
raketka [301]3 years ago
6 0

Answer: $400.56

Explanation:

Horizon value = Tax shield in 3rd year * (1 + growth rate) / (Required return - Growth rate)

Tax shield in year 3 = Interest expense * tax rate

= 140 * 25%

= $35

Horizon value = 35 * ( 1 + 3%) / (12% - 3%)

= $400.56

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Greg, a supervisor, is known by his managers to be sharp in his decisions and has a good track record of meeting his goals. greg
shepuryov [24]

Answer: (B) Effective

Explanation:

 Greg is an effective supervisor as they supervise or guide all the employees in an organization for the purpose of completing the tasks, meet the actual deadlines and also motivating the employees.

It has the good leadership quality and also recognizing all emotions according to the given task.

 According to the given question, the effective supervision taking various types of sharp decisions and also tracking all the tasks for meeting the goals.

 Therefore, Option (B) is correct answer.  

4 0
4 years ago
7. What is supply and demand? Give me an example of a supply and demand currently?
Marysya12 [62]

Answer:

Supplier sells the goods at various prices, depending on how much consumers want it, and at the rate that the goods are being sold.

For example, now, during the pandemic,  face masks are now in very very high demand. Due to this, suppliers has now increased the price of the face masks, as to take advantage of the current situation

4 0
3 years ago
You are convinced that a stock's price will move by at least 15% over the next 3 months. You are not sure which way the price wi
Sophie [7]

Answer:

b. buy a strip.

Explanation:

The strip is the option strategy in which we can purchase two options and one call option at the similar strike price and the similar maturity time period. It should be considered at that case when there is high expectation in bearish as compared with the bullish.

Since in the question it is mentioned that there is more bearish than bullish so here the buy a strip would be relevant

hence, the option b is correct

6 0
3 years ago
The major diversification strategy through which products are produced that are technically similar to the company’s current pro
Anon25 [30]

Answer:

a. Concentric diversification

Explanation:

The concentric diversification is a diversification in which a company purchased or developed its new products that are closely related to that product in which the company is dealing in order to enter one or more markets

Here in the given situation, since the company produced that product that are same to their current markets so that they could enter into a new customer group so this represents the concentric diversification

8 0
3 years ago
Potter industries has a bond issue outstanding with an annual coupon of 6% and a 10-year maturity. the par value of the bond is
umka21 [38]

Answer:

The value of the bond which is the current price is $ 830.16  

Explanation:

It is very vital to note that a rational investor values a bond today based on  the cash flows payable by the bonds in future discounted to today's terms.            

The future cash flows comprise of the yearly coupon interest of $60(6% *$1000) for 10 years as well as the repayment of the principal $1000 at the end of year 10              

To bring the cash inflows today's term, we multiply them them by the discounting factor 1/(1+r)^N , where is the yield to maturity,r is  8.6% and N is the relevant the cash flow is received.              

The discounting is done in attached spreadsheet leading to $ 830.16   present  value today.

It is expected that the bond would be issued at discount as yield to maturity is higher than annual interest.      

Download xlsx
6 0
4 years ago
Read 2 more answers
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