Answer:
Cost of equity is 11.2%
WACC is 8.74%
Explanation:
The formula for cost of equity is given below:
Cost of equity=risk free rate+(Beta *risk premium)
risk free rate is the treasury bill rate of 4%
Beta is 0.9
market risk premium is 8%
cost of equity=4%+(0.9*8%)=11.2%
WACC=Ke*E/V+Kd*D/V*(1-t)
Ke is the cost of equity of 11.2%
Kd is the cost of debt of 5%
t is the tax rate of 40% or 0.4
E is the equity weighting of 70% or 0.7
D is the debt weighting of 30% or 0.3
V is the E+D=0.7+0.3=1
WACC=11.20%
*0.7/1+(5%*0.3/1*(1-0.4)
WACC=7.84%
+0.90%
=8.74%
There are a few problems that can arise from exporting large amounts of central American agricultural products. One is that the products may not be able to meet the demand in other countries, which can lead to prices rising and products becoming scarce.
What is American agricultural?
With only one farmer or farm worker needed on average per square kilometre of cropland for agricultural production, American agriculture is highly mechanised. Even though farming is practised in every state in the US, it is most prevalent inside the Great Plains, a vast area of flat arable land in the middle of the country, west of the Great Lakes as well as east of a Rocky Mountains. The Corn Belt, which produces a lot of corn and soybeans, is located in the wetter eastern half, and the Wheat Belt, which produces a lot of wheat, is located in the drier western half. Fruits, vegetables, and nuts are produced in the Central Valley of California.
Additionally, if the products are not properly stored or shipped, they can spoil and become worthless. Finally, if the products are not marketed properly, they may not sell well and may not generate the income that was expected.
To learn more about American agricultural
brainly.com/question/27122656
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<span>The marginal propensity to consume is a metric
that quantifies the concept of increase in consumption with an increase in
income. Mathematically MPC is defined as:</span>
MPC = Change in consumption / Change in income
Purchase of goods and services is considered as
consumption, therefore:
Change in consumption = $16 billion
In the government’s perspective, taxes are
considered as income, therefore the problem ask us to find for the necessary change
in tax collection to maintain equilibrium GDP. Substituting the values in the
formula:
0.80 = $16 billion / Change in income
Change in income = $20 billion
<span>Therefore the government should increase the tax collection by $20
billion.</span>
Answer:
15.20%
Explanation:
The computation of the M1 increase is shown below:
= (M1 End of the year 2011 - M1 end of the year 2010) ÷ M1 End of the year 2010
= ($2,311 billion - $2,006 billion) ÷ ($2,006 billion)
= 15.20%
