I agree because since Adults have seen more of the world more than kids, they are less likely to imagine things
Answer:
The right response is "4.102%".
Explanation:
Given:
Number of half years,
n = ![25\times 2](https://tex.z-dn.net/?f=25%5Ctimes%202)
= ![50](https://tex.z-dn.net/?f=50)
Coupon per half years,
c = ![1000\times \frac{6.3 \ percent}{2}](https://tex.z-dn.net/?f=1000%5Ctimes%20%5Cfrac%7B6.3%20%5C%20percent%7D%7B2%7D)
= ![31.5](https://tex.z-dn.net/?f=31.5)
Price,
pv = 949
Par value,
= 1000
Now,
The YTM will be:
= ![rate(n,c,-pv,fv)\times 2](https://tex.z-dn.net/?f=rate%28n%2Cc%2C-pv%2Cfv%29%5Ctimes%202)
= ![rate(50,31.5,-949,1000)\times 2](https://tex.z-dn.net/?f=rate%2850%2C31.5%2C-949%2C1000%29%5Ctimes%202)
=
(%)
hence,
After tax cost of debt will be:
= ![YTM\times (1-tax \ rate)](https://tex.z-dn.net/?f=YTM%5Ctimes%20%281-tax%20%5C%20rate%29)
= ![6.724\times (1-39)](https://tex.z-dn.net/?f=6.724%5Ctimes%20%281-39%29)
=
(%)
Answer:
The correct answer is letter "B": The contract has a financing component that is significant to the contract.
Explanation:
Time value of money is a principle that states that today's dollar is worth more than tomorrow's dollar. This is because the money that could be received today may be deposited in a savings bank account or invested which implies that the initial sum has the potential to grow. If the same amount is received in later dates, the sum it could grow is likely to be lower.
Therefore,<em> if in a contract there is a financing component which implies considering an interest rate, the time value of money is to be included.</em>
Answer:
$20.83
Explanation:
The computation of the cost of preferred stock is shown below:
Cost of preferred stock = (Dividend × par value) ÷ (current selling price) × 100
= (10% × 100) ÷ ($48) × 100
= 10 ÷ 48 × 100
= $20.83
Simply we divide the dividend by the current selling price so that the cost of preferred stock can be computed
All other information which is given is not relevant. Hence, ignored it