1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Allushta [10]
3 years ago
8

The chapter argues that investment depends negatively on the interest rate because an increase in the cost of borrowing discoura

ges investment. However, firms often finance their investment projects using their own funds.
If a firm is considering its own funds (rather than borrowing) to finance investment projects, will high interest rates discourage the firm from undertaking these projects? Explain.
Business
1 answer:
WARRIOR [948]3 years ago
8 0

Answer: Yes they will.

Explanation:

With high interest rates, the company will be able to make better returns if they invested the money and took advantage of those interest rates instead of spending the money on their project.

Assets like bonds will be better to go into because they will offer a return based on the higher interest rates which will bring in good returns.

The company is free to use those funds to invest in projects if these projects will lead to a better return than could be gotten from holding bonds but if that is not the case, they should simply buy bonds and hold them for superior returns.

You might be interested in
eating small amounts of sweet desserts can satisfy one's urge or craving for healthier food. true or false?​
krok68 [10]

Answer:

I think eating healthier food would be better. Eating sweet desserts would be healthier than eating a lot, but you should still cut down and eat healthier foods. False

Explanation:

6 0
3 years ago
On January 1, Year 1, Zero Company obtained a $52,000, 4-year, 6.5% installment note from Regional Bank. The note requires annua
Gnom [1K]

Answer:

$ 11,799 is the principal balance of the note payable.

Explanation:

The  Interest expense for the installment note on the year of the December 31, year can be determined by the following equation that are mention below

= 52,000 * 6.5\ percent

52,000 * \frac{6.5}{100}

= $\ 3,380

Now the Principal balance  of the component in $15,179 payment of the  December 31, year 1  can be determined by the

principal\  and \ interest\ of \ note\ annual\  payments -   Interest\ expense \ for\  the\  installment\   note

= 15,179 -3,380

=$ 11,799

5 0
2 years ago
When text is indented in an outline, what does that usually mean?
andrew11 [14]

Answer:

D

Explanation:

its is D because why not ight

3 0
3 years ago
Read 2 more answers
George owns a pizzeria in Queens, and he buys his cheese and dough and sauce from SYSCO. This firm provides its customers with t
alexandr1967 [171]

Answer:

Trade credit

Explanation:

Trade credit occurs between traders where a trader allows another to purchase goods without paying for them immediately.

It is the cheapest form of short term financing.

This is a form of business to business agreement where payment is set at a later date of 30 days, 90 days or 60 days.

The transaction is recorded by using invoice.

Usually it is a zero percent short term finance. The amount of the good at time of purchase is what is paid at the sure date.

There is no extra payment made by the buyer as interest on the amount agreed.

5 0
2 years ago
Cullumber Company’s 12/31/21 balance sheet reports assets of $11450000 and liabilities of $4890000. All of Cullumber’s assets’ b
Arturiano [62]

Answer:

$4,392,000

Explanation:

For computing the cost of the goodwill, first we have to calculate the fair value of the net asset which is shown below:

The fair value of net asset = Asset balance + fair value of land  - liabilities balance

= $11,450,000 + $690,000 - $4,890,000

= $7,250,000

And, the acquire value is $11,642,000

So, the goodwill would be  

= $11,642,000 - $7,250,000

= $4,392,000

4 0
3 years ago
Other questions:
  • A company has revenue of $1000 in 2009. Our current estimate is that revenues will grow 25% per year. Our profit each year will
    5·1 answer
  • Jaycee Jeans sold 40 pairs of jeans at a price of​ $40. When it lowered its price to​ $20, quantity sold increased to 60 pairs.
    8·1 answer
  • Which of the following is a benefit of outsourcing? a. It makes employees self-reliant. b. It helps a firm meet its expansion ne
    6·1 answer
  • Match the different types of incomes to their sources.
    5·2 answers
  • Suppose the real interest rate is 4% and expected inflation is 1% . What is the nominal interest rate? nominal interest rate: %
    10·1 answer
  • You write one JNJ February 70 put for a premium of $5. Ignoring transactions costs, what is the break-even price of this positio
    11·1 answer
  • In a fractional reserve banking system: Group of answer choices banks create money by printing it. banks create money by making
    9·1 answer
  • How many slides would be in a PowerPoint presentation based on the formatting of the Word outline?
    9·1 answer
  • Young Company is beginning operations and is considering three alternatives to allocate manufacturing overhead to individual uni
    6·1 answer
  • you purchased one hundred shares of AT&T stock. The company pays 20 cents per share to each share holder (That’s you!) at th
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!