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Reptile [31]
3 years ago
13

If a firm applies its overall cost of capital to all its proposed projects, then the divisions within the firm will tend to ____

__. Group of answer choices receive less funding if they represent the riskiest operations of the firm avoid risky projects so that they will receive more funding become less risky over time based on the projects that are accepted have equal probabilities of receiving funding for their projects propose higher risk projects than if separate discount rates were applied to each project
Business
1 answer:
balandron [24]3 years ago
6 0

Answer:

receive less funding if they represent the riskiest operations of the firm                

Explanation:

In simple words, the cost of capital is represented as weighted average and its represents the level or return expected by the investors and represents the level of risk of the firm on average. Therefore, managers tends to lift up or down this return depending upon the risk of the potential project to be taken.

   Thus, if the average return will be applied for all projects then high risk projects will get less funding and low risk project will get excess funding.

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As the average hourly wage increases from $18 per hour to $20 per hour, the quantity of frozen dinners demanded decreases from 3
horrorfan [7]

Answer:

The income elasticity of demand for frozen dinners is negative when there is an increase of hourly wages. -51%

Explanation:

When the income elasticity is negative it means that the good is inferior so when the income is increased, the demand of the good decrease beacuse its demand change to a better quality good. For instance in this case a fresh meal.

income elasticity % = % change in quantity / % change in income

(((3350-3550)/3550)/((20-18)/18))*100

7 0
3 years ago
Why is it difficult for most small business owners to raise the capital needed to start, operate, or expand their ventures?
Andre45 [30]

Answer:

1. It is not easy to get funds for a start up, as many banks do not consider it as a successful decision to provide loan to a start up, as the feasibility of recovery of loan cannot be identified and guaranteed.

2. Venture capitalists also faces the same issue as of bank, also they are large equity investors and tend to invest in even larger project.

3. Private investors do not blindly invest and rather are more cautious then banks or venture capitalists, as because they do not huge funds to invest, and with less amount of investment they need even higher assurance.

4. Public stock is never available for a start up as for public stock issue you need great credibility, and good previous record.

4 0
3 years ago
Manuel borrowed a total of $4000 from two student loans. One loan charged 4% simple interest and the other charged 3.5% simple i
hichkok12 [17]

Answer:

the principal amount at a rate of 4% is 2000

principal amount at a rate of 3.5% is 4000-2000 =2000

Explanation:

We have given total amount borrowed = $4000

Let x amount is borrowed at a rate of 4%

So $4000-x is borrowed at rate of 3.5%

Total interest = $150

We know that simple interest =\frac{principal\ amount\times rate\times time}{100}

So \frac{x\times 4\times 1}{100}+\frac{(4000-x)\times 3.5\times 1}{100}=150

4x+14000-3.5x=15000

0.5 x=1000

x = 2000

So the principal amount at a rate of 4% is 2000

And principal amount at a rate of 3.5% is 4000-2000 =2000

7 0
4 years ago
Marketplaces - 8th - Business Tech
mr_godi [17]

Answer:

low

Explanation:

cost of borrowing money is less

4 0
3 years ago
Augi is the hottest new pop singer, but her agent discovers that Internet sales of Augi's music have been poor due to Internet p
Serggg [28]

Answer:

The correct answer is letter "C": keep prices of downloads low and raise prices for concerts and merchandise.

Explanation:

To maximize profits, Augi's agent should not stop doing any of the commercial activities the pop singer has been carrying out. However, a way to deal with Augi's music internet piracy, the agent could lower the online-song prices but the "losses" can be compensated by raising the concert ticket prices and the singer's merchandise sold there since most of Augi's concerts are sold-outs.

3 0
3 years ago
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