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Paul [167]
3 years ago
7

Piedmont Hotels is an all-equity company. Its stock has a beta of .82. The market risk premium is 6.9 percent and the risk-free

rate is 4.5 percent. The company is considering a project that it considers riskier than its current operations so it wants to apply an adjustment of 1.7 percent to the project's discount rate. What should the firm set as the required rate of return for the project?
Business
1 answer:
katrin2010 [14]3 years ago
7 0

Answer:

11.86%

Explanation:

Piedmont hotels can be described as an all-equity company

Its stock has a beta of 0.82

The market risk premium is 6.9%

The risk free rate is 4.5%

The adjustment is 1.7%

Therefore, the required rate of return can be calculated as follows

Required rate of return= Risk free rate of return + ( beta×market risk premium) + adjustment

= 4.5% + (0.82×6.9%) + 1.7%

= 4.5% + 5.658 + 1.7%

= 11.86%

Hence the required rate of return for the project is 11.86%

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In many cases, the causes of scope creep reflect a misfit between ____.Multiple Choicetraditional project management methods bei
11111nata11111 [884]

Answer:

<em><u>The correct answer is:</u></em> traditional project management methods being applied to high uncertainty projects

Explanation:

Scope creep are common in projects, but they can raise concerns because they mean increased time and expense.

Scope increase may occur when there is a mismatch between traditional project management methods being applied to projects of high uncertainty.

This mismatch can mean that the control is inflexible and being a project of high uncertainty, it is quite possible that there will be changes during the project that include other processes and ways to achieve the expected objective.

This situation can cause frustration among stakeholders and waste of time and money, which can be avoided with more effective control and greater clarity about the project's objectives.

5 0
3 years ago
Why do you need your rate of return to be greater than inflation
slavikrds [6]
Because when inflation levels are stable and moderate, investors have lower expectations of high market returns. Conversely, expectations rise when inflation is high.
6 0
2 years ago
Identify five entrepreneurial qualities that have contributed to the success of his/her business .justify your answer
statuscvo [17]

The entrepreneurial qualities that helps any businessman to be successful in his or her business are as follows:

1) The quality of goods and services should be maintained.

2) The information regarding the product needs to be disseminated to the public.

3) Finance and funding should be taken care of to avoid illegal profits and bankruptcy.

4) True and fair means of practices should be followed.

5) The entrepreneur should be accountable and responsible for the services provided by him.

5 0
3 years ago
Exercise 6-16 Kaleta Company reports the following for the month of June. Date Explanation Units Unit Cost Total Cost June 1 Inv
Irina18 [472]

Answer:

Cost of goods available for sale=$1,640

Explanation:

To calculate the cost of goods available for sale, we need to first calculate the available units of inventory;

Available inventory=Inventory purchased-inventory sold

where;

Inventory purchased are as follows;

On June 1>>>>>purchased 410 units each at $8

On June 12>>>>purchased 820 units each at $9

On June 23>>>>purchased 615 units each at $10

Total inventory purchased=(410+820+615)=1,845 units

Inventory sold are as follows;

On June 15>>>>sold 902 units each at $11

On June 27>>>>sold 738 units each at $12

Total inventory sold=(902+738)=1,640 units

Available inventory=(1,845-1,640)=205 units

The cost of goods sold can be expressed as;

Cost of goods available for sale=Cost per unit×number of units

where;

Number of units of inventory=205

Cost per unit=least cost per unit=$8

replacing;

Cost of goods available for sale=(8×205)=1,640

Cost of goods available for sale=$1,640

8 0
3 years ago
A faculty member is retiring, and a committee has been established to select a replacement. HR conducts candidate recruitment, a
lisabon 2012 [21]

Answer:

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Explanation:

This dean has gone ahead to rewrite David's description. By so doing he has altered the job description to favor david. This shows a bias to David in the side of this dean thereby causing him to violate the act that says that there should be no discrimination or bias of my form.

Rewriting the job description to favor david is against the ethics of the distributive justice framework which says that the distribution of goods in a society must be done In an equitable manner for all. 2 principles of this are applicable here. The rights based justice and also the legal justice. Rights based justice demands that the rights of people bare respected which the dean has clearly also violated.

8 0
3 years ago
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