Explain in detail that increase in the capital stock would cause the real rental price of capital to (Hint: Use Cobb-Douglas production function)
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Explain in detail that increase in the capital stock would cause the real rental price of capital to (Hint: Use Cobb-Douglas production function)
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- Which capital budgeting technique(s) measure all expected future cash inflows and outflows as if they occurred at a single point in time? a. net present value and internal rate of return b. net present value and payback. c. internal rate of return and payback d. paybackIf the contract annual interest rate on a $2,880,000 fixed rate loan that is fully amortizing over 20 years with equal monthly payments is 6.25%, what is the effective yield to the lender if the lender charges 1.5% as an origination fee, $288 for a credit report and $3,080 for an appraisal fee and the loan is repaid after ten years? a. 6.25% b. 6.51% c. 6.46% d. 6.49%Construct the amortization schedule for a $7000 debt that is to be amortized in 6 equal quarterly payments at 2% interest per quarter on the unpaid balance. How much interest must be paid?
- 27.Options buyers who are delta-hedging (riskless hedge) would do which of the following in the underlying (asset) market. A. buy when the underlying market is falling and sell when it is rising. B. sell when the underlying market is falling and buy when it is rising. C. buy whether the underlying market is falling or rising. D. sell whether the underlying market is falling or rising.With respect to the cost of capital, we are generally interested in the cost of a source of financing on a particular date. Select one: a. False b. TrueOne of your customers is delinquent on hisaccounts payable balance. You’ve mutually agreed to a repayment schedule of $700per month. You will charge 1.3 percent per month interest on the overdue balance. Ifthe current balance is $21,500, how long will it take for the account to be paid off ?
- Advantages of preparing cash budget would not include one of the following: a. Debtors of the business can be allowed more time to make payment b. If shortage of cash is expected, overdraft facility can be arranged c. Surplus cash can be put to profitable uses if surplus is expected to occur d. Time is available to identify the future sources of finance ------fast plzMarvelous Music provides music lessons to student musicians. Adjusting entries are performed on a monthly basis. An unadjusted trial balance dated December 31, 2020, follows. (Bear in mind that adjusting entries have already been made for the first 11 months of 2020, but not for December.) Prepare the necessary adjusting entry. Prepare an adjusted trial balance. An unadjusted trial balance is given below. MARVELOUS MUSIC UNADJUSTED TRIAL BALANCE DECEMBER 31, 2020 Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15,800 Accounts receivable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,100 Unexpired insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,200 Prepaid rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,000 Sheet music supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .…Fund 1 2 3 4 5 6 7 CO 8 9 10 1231 11 12 13 14 15 16 17 Risk High High High High High High Medium Medium Medium Medium Medium Low Low Low Low Low Low Туре Stock Stock Stock Stock Stock Stock Blend Blend Blend Blend Blend Blend Blend Bond Bond Bond Bond Return 11.98% 13.18% 9.40% 7.71% 8.35% 16.38% 4.10% 12.52% 8.62% 11.14% 8.78% 9.44% 8.38% 7.65% 6.90% 5.53% 6.30% His financial advisor has suggested that at most 40% of the portfolio should be composed of high-risk funds. At least 25% should be invested in bond funds, and at most 40% can be invested in any single fund. At least six funds should be selected, and if a fund is selected, it should be funded with at least 5% of the total contribution. Develop and solve an integer optimization model to determine which funds should be selected and what percentage of his total investment should be allocated to each fund.
- comment if the stock is undervalued or overvalued if CAMP return is 12% & historical estimated return is 10% Options are : Overrated undervalued correctly priced cannot be determinedWhat is the After-tax Cost of Debt for Foggy Futures Weather Forecasters? The firm is in the 40% tax bracket. The firm can issue $1000 par value, 9% coupon interest bond with a 15 year maturity date. The selling price is $1,000. There will be a Discount of $20 and Flotation cost of $25. (NB: Use the intrinsic (internal) values (rates, cost) of each component in the capital structure.)In order to raise capital, XYZ company decided to issue loan certificates. The loan certificates have fixed interest rate of 20% and payable over 10 years. Therefore, XYZ company is raising capital through O None of the options Selling shares Debentures Equity finance II