Answer:
d. people face trade-offs.
Explanation:
The production possibility frontier shows all the combinations of two goods an economy can produce when all its resocurces are fully employed.
At one extreme of the curve, the highest possible amount of one good is produced while zero quantity of the second good is produced . To produce more quantity of the second good, one has to produce less quantity of the first good. This illustrates trade off.
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Answer:
The Required Return is 10.82%.
Explanation:
The Dividends Model for the Constant Growth is given below:
P0 = D1 / (Ke - g)
Arranging the above equation for "Ke", that is the Required Return:
⇒ Ke = (D1 / P0) + g
Putting Values and we get:
Required Return = Ke = (2.34 / 37) + .045 = .1082 = 10.82%.
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Answer:
n= 6.11 years
Explanation:
Giving the following information:
Present value= $40,000
Future value= $20,000
Decrease rate= 0.12
<u>To calculate the number of years for the car to reach a value of $20,000; we need to use the following formula:</u>
n= ln(FV/PV) / ln(1+i)
n= ln(20,000/40,000) / ln(1.12)
n= 6.11 years
Answer: Corporate bond
Explanation:
It should be noted that the municipal bond aren't taxable. Therefore, its yield will be 4.75%.
On the other hand, the After Tax Cost of the yield of the corporate bond will be:
= Yield × (1-Tax Rate)
= 8.25% × (1-35%)
= 8.25% × 65%
= 5.36%
Therefore, the Corporate Bond should be chosen since it has a higher yield.
