Answer:
Re = 15.29%
Explanation:
beta at current debt level:
11.5% = 5% + (beta x 6%)
6.5% = 6%beta
beta = 6.5% / 6 = 1.083
unlevered beta = 1.083 / {1 + [(1 - tax rate) x debt / equity]} = 1.083 / {1 + [(1 - 40%) x 25 / 75]} = 1.083 / 1.2 = 0.9025
cost of levered beta at 60% debt:
0.9025 = beta / {1 + [(1 - 40%) x 60 / 40]}
0.9025 x 1.9 = beta
beta = 1.7148
Re = 5% + (1.7148 x 6%) = 15.29%
Answer: people tend to take more risks if they do not have to bear the costs of their behavior
Explanation:
Moral hazard is a form of reckless behavior by an individual who doesn't directly bear the cost of the reckless behavior.
Moral hazard takes several forms like the examples of : polluting waters with chemicals, throwing refuse into drainage, mismanagement of public amenities.
<h2>IFRS brings transparency, accountability and efficiency to finanacial market across the globe.</h2>
Explanation:
IFRS - International Financial Reporting Standards
Transparency:
a) international comparability
b) quality of financial information,
- enabling investors to make "economic decisions"
Accountability:
- It strengthens this aspect by reducing the information gaps
Efficiency:
- Helps investors to identify market opportunities
- Alert about the risks across the world
- lowers the Capital cost
Answer:
additional costs for attending a college or university
Explanation:
:)
Answer: The answer is A productivity
Explanation:
Productivity is a measure of the relationships between the quantity of goods produced in an organization in comparison with the resources that are needed by such organization in producing such goods. The resources invested in producing the goods by the organization includes money, machines, material, Labour. For instance, the introduction of a new method of production can lead to an increase in the level of productivity of an organization.
