Answer:
The company will budget $0.91 billion for advertising
Explanation:
Determine the initial percentage of sales spent in advertising is as shown;
initial percentage of sales=(amount spent in advertising/total revenue)×100
where;
amount spent in advertising=0.8 billion
total revenue=15 billion
replacing;
initial percentage of sales=(0.8/15)×100=5.33%
Determine forecasted percentage of sales as shown;
forecasted sales=initial percentage×forecasted sales
forecasted advertising=5.33% ×17 billion
forecasted advertising=$0.91 billion
The company will budget $0.91 billion for advertising
One of the largest contributions to health problems in
low-income countries is the clean water access. It is because this is the
common problem in low-income countries because they don’t usually have clean
water because of their standing and other factors that create this problem and
by that, this is the largest contributions that are used a project or
contribution given by other counties to help the low-income countries
experiencing this type of crisis.
The average nominal risk premium on the long-term government bonds was 2.6 percent.
A risk premium is the expected investment return on an asset that is higher than the risk-free rate of return. The risk premium on an asset is a form of compensation for investors. It compensates investors for tolerating the additional risk in a given investment over that of a risk-free asset. Subtracting the return on risk-free investment from the return on investment yields the risk premium.
The nominal risk premium is:
Nominal Risk-Free Rate - Inflation Premium = Real Risk-Free Rate. Nominal rates are the rates we encounter on a daily basis, such as interest rates from banks and other financial institutions.
Nominal risk premium = 6.1 % -3.5 %
= 2.6%.
Learn more about risk premium here-
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Answer:
c. 10%
Explanation:
The Yield to Maturity(YTM) of the Bond is the cost of the debt. So, we need to find the YTM first.
Here i will use a Financial Calculator to enter and compute the YTM as follows :
N = 20× 2 = 40
PMT = ($1,000 × 8%) ÷ 2 = $40
PV = $828
P/YR = 2
FV = 1,000
I or YTM = ?
Thus the cost of the Bond is 10%
Answer:
5%
Explanation:
Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
The interest rate implicit in the agreement can be determined by finding the internal rate of return.
Cash flow in year 0 = $-196,401
Cash flow each year from year 1 to 7 = $33,942
IRR = 5%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
