Answer:
C. To enforce property rights
Explanation:
Government intervention in market can be non materistically via regulation , materistically via taxes & subsidy.
Although the second materislistic way of tax, subsidy comes under the perview of 'Government Budget' .
Government budget is anual financial statement showing economy's expected revenue & expenditure .
Economic growth & stability by reallocation of resources , reducing income inequalities - reflect 'efficiency' & 'equity' as valid reasons .
Foreign protection is also not invalid depending upon the initial budding stage of a developing economy & its global stand. Eg - India 1950 to 1990 .
However all these are progressive legitimate reason for govt. Intervention .
But , enforcing property rights is a feature of 'socialistic (communistic) economy - which has its own demerits like loss of consumers soveireignity , lack of postive competitive efficiency , govt overburden.
The last one. hope it helps!
Answer:
7.65%
Explanation:
required return = (percent of stock x required return on stock) + (after tax cost of debt x percent of debt) - adjustment factor
Percent of debt = 100 - 73 = 27%
(12.1 x 0.73) + (3.79 x 0.27) - 2.2 = 7.65%
Answer:
The situation is called insolvency. insolvency is refer to the situation when debtor is unable return its debt. The same is happened in the given situation. In the above case due to not paid by manufacturing unit, bank is unable to pay to depositor.
Insolvency is refer to that critical condition when debtor unable to pay amount to depositor. In the above given case even if bank want to sell its all assets it cannot cover its liabilities.Explanation:
Answer:
The correct answer is: 8.72%
Explanation:
Cost of debt K d = I (1 – t) + (-pi)/n
(SV + RV)/2
= 80(1 – 0.40) + (-75)/25
(1,000 + 1,075)/2
= 0.043 or 4.3%
Cost of equity K e = R f + b (R m – R f)
R m – R f = 5.5% = market risk premium
R f = risk free rate = 4.5%
B = beta = 1.2
K e = 4.5% + 1.2(5.5%)
= 11.1%
WACC = W d * K d + We * K e
= 35% * 4.3% + 65% * 11.1%
= 1.505 + 7.215
= 8.72%
