After calculating, the expected rate of return on Thayer Farms stock is 13.20%.
To calculate the expected rate of return on Thayer Farms stock, you can use the capital asset pricing model (CAPM) formula:
Expected Return = Risk-Free Rate + Beta * Market Risk Premium
Given the provided values:
Risk-Free Rate = 4.34%
Market Risk Premium = 7.92%
Beta = 1.12
Substituting these values into the formula:
Expected Return = 4.34% + 1.12 * 7.92%
Expected Return = 4.34% + 8.86%
Expected Return = 13.20%
Therefore, the expected rate of return on Thayer Farms stock is 13.20%.
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what government economic strategy reduces taxes on businesses who invest in increasing their productivity?
The main answer is supply-side economics. Supply-side economics is a government economic strategy that focuses on reducing taxes, particularly on businesses and individuals, to incentivize investment, increase productivity, and stimulate economic growth.
By reducing tax burdens on businesses that invest in productivity-enhancing activities such as research and development, capital expenditures, and innovation, supply-side economics aims to create a favorable environment for economic expansion. This strategy assumes that lower taxes will lead to increased investment, job creation, and overall economic prosperity. The underlying idea is that by allowing businesses to keep more of their earnings, they will have more resources available for investment, which, in turn, will drive economic growth and generate positive multiplier effects throughout the economy.
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Advertising in a monopolistically competitive allows for the charging of higher prices. the firm to sell a greater amount of product. all of these. increasing profits: Question 7 1pts You read that 30 fish farms that produce and export caviar to Europe decide to form a cartel. The cartel wants to raise the price of caviar and reduce supply to increase profits for the caviar producers. This caviar cartel (really exists) will, most likely, be unsuccessful because there are too many firms and there are a number of substitutes for caviar. succeed because the caviar demand is inelastic. be successful because it will be very easy to enforce the rules among onily 30 firms. not be successful because there are too few firms that are trying to organize the cartel. The decisions made in a monopolistically competitive firm will resemble something between & imperfect competition; oligopoly monopoly: imperfect competition imperfect competition; perfect competition monopoly; perfect competition
The cartel will most likely be unsuccessful because there are too many firms and there are a number of substitutes for caviar.
In monopolistically competitive markets, there are many firms producing similar but differentiated products. In this case, caviar is a differentiated product. The formation of a cartel by 30 fish farms in an attempt to raise prices and reduce supply would face challenges.
Firstly, the presence of numerous firms means that it would be difficult for the cartel to control and enforce the agreed-upon production and pricing strategies among all participants. Cheating and non-compliance are common issues.
Secondly, the existence of substitutes for caviar provides consumers with alternatives, reducing their dependence on a single product. If the cartel raises prices, consumers may switch to substitutes, leading to a decrease in demand for caviar.
Therefore, due to the large number of firms and the availability of substitutes, the caviar cartel is likely to be unsuccessful in achieving its goal of increasing profits for the caviar producers.
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Answer the following time value of money questions assuming the interest rate is 7 percent. a. What is the present value of $800 to be received in four years? b. What is the present value of $800 to be received in eight years? c. What will be the value in seven years of $11,300 invested today? d. How much would you pay for the right to receive $4,300 at the end of year 1,$3,300 at the end of year 2 , and $7,300 at the end of year 5 ? e. How long will it take for a $1,300 investhnent to double in value? f. What will be the value in 20 years of $1,100 invested at the end of each year for the next 20 years? Note: Round your answers to 2 decimal places.
The following is the solution for time value of money questions assuming the interest rate is 7 percent.
a. Present Value of $800 to be received in four years is as follows: PV = FV / (1 + r)nt PV = $800 / (1 + 0.07)4PV = $584.19 (rounded to $584.20)
b. Present Value of $800 to be received in eight years is as follows: PV = FV / (1 + r)nt PV = $800 / (1 + 0.07)8PV = $453.37 (rounded to $453.40)
c. Value in seven years of $11,300 invested today is as follows: FV = PV × (1 + r)nt FV = $11,300 × (1 + 0.07)7FV = $18,268.87 (rounded to $18,268.90)
d. The present value of the right to receive payments of $4,300 at the end of year 1, $3,300 at the end of year 2, and $7,300 at the end of year 5 is as follows: PV = $4,300 / (1 + 0.07)1 + $3,300 / (1 + 0.07)2 + $7,300 / (1 + 0.07)5PV = $8,636.72 (rounded to $8,636.70)
e. Time taken for an investment of $1,300 to double in value is as follows:2 = 1 / (1 + 0.07)nlog 2 = n × log(1 + 0.07)n = log 2 / log(1 + 0.07)n = 9.91 (rounded to 9.92)
f. Value in 20 years of $1,100 invested at the end of each year for the next 20 years is as follows:FV = PMT × ((1 + r)n - 1) / rFV = $1,100 × ((1 + 0.07)20 - 1) / 0.07FV = $55,259.22 (rounded to $55,259.20)
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Assume that the United States imposes an import quota on Columbian coffee. Relative to the
equilibrium world price that would prevail in the absence of import quotas, it is likely that
the equilibrium price of coffee in the United States will _____ and the equilibrium price of
coffee in Columbia will _____.
a) decrease; remain the same
b) remain the same; increase
c) increase; increase
d) increase; decrease
The imposition of the import quota is expected to cause an increase in the equilibrium price of coffee in the United States and decrease in the equilibrium price of coffee in Colombia. The Option D.
How will the imposition affect the equilibrium prices of coffee in both countries?When a country imposes an import quota, it restricts the quantity of goods that can be imported from another country. This restriction reduces the supply of Colombian coffee in the US market causing the equilibrium price to increase.
But in Colombia, the reduced demand from the US market due to the import quota leads to a surplus of coffee which puts downward pressure on the equilibrium price in Colombia.
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T/F: when norris asked fran where she wanted to go for lunch, she said panera bread because she used to go there at least once a week and always liked it. fran conducted an internal search for information.
The given statement is an example of a true statement. Therefore, the correct option is T.
True is a statement that refers to something that is accurate, factual, or correct.
The given statement suggests that Norris asked Fran about where she wants to go for lunch, and she recommended Panera Bread because she always liked it and used to go there at least once a week. In this scenario, Fran conducted an internal search for information.
In marketing, the process of searching for information within a customer's memory is referred to as internal search. It is the process of evaluating data and details from memory about the products or services that can help to satisfy a need.
This data may be gained from personal experience, personal connections, or other non-marketing sources.
Therefore, the given statement is a true statement since Fran conducted an internal search for information.
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Marked out of 1.00 P Flag question Change in CA=500 and change in CL=570, what implications on cash flows we would have: Select one: a. decrease by 70 b. increase by 570 c. increase by 70 d. increase by 1070 Clear my choice
The change in CA = 500 and change in CL = 570 will result in a decrease in cash flows by 70. The correct is option A) decrease by 70.
Cash flow is a financial statement that indicates how much cash or cash equivalents are generated and used by a company over a specified period. Cash flow is concerned with the inflow and outflow of cash and cash equivalents from an enterprise or a business over a specified period, such as a quarter or a year.
Current liabilities are short-term debts that a company owes and must pay within a year. An increase in current liabilities would increase cash flows, while a decrease in current liabilities would decrease cash flows.
Change in CA = 500
Change in CL = 570
The formula to calculate cash flow is:
Cash Flow = Operating Cash Flow (OCF) + Investing Cash Flow (ICF) + Financing Cash Flow (FCF)
Change in Cash = Change in CA - Change in CL
Cash Flow = -70
Change in Cash is calculated by subtracting change in CL from the change in
CA.= Change in CA - Change in CL
= 500 - 570
= -70
Therefore, the cash flows will decrease by 70. The correct is option A) decrease by 70.
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a(n) ______ assessment measures the direct value of tangible assets.
A tangible asset assessment measures the direct value of tangible assets.
Tangible assets are physical assets that can be seen, touched, or quantified. Examples of tangible assets include buildings, land, machinery, equipment, vehicles, inventory, and cash. These assets have a physical form and can be assigned a monetary value.
A tangible asset assessment involves determining the fair market value or book value of these assets. Fair market value refers to the price at which an asset would sell in an open and competitive market, while book value represents the value of an asset as recorded in the company's accounting books.
The assessment of tangible assets is important for various purposes, including financial reporting, insurance purposes, investment decisions, mergers and acquisitions, and tax calculations. It provides insights into the value and worth of a company's physical resources, which can impact its overall financial position and strategic decision-making.
Appraisal methods, such as cost approach, market approach, or income approach, may be used in the assessment of tangible assets, depending on the nature of the assets and the specific context in which the assessment is conducted.
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Which of the following statements is correct concerning a governmental entity's statement of cash flows? a. Cash flows from capital financing activities and cash flows from noncapital financing activities are reported separately. b. The statement format is the same as that of a business enterprise's statement of cash flows. c. Cash flows from operating activities may not be reported using the indirect method. d. The statement format includes columns for the general, governmental, and proprietary fund types.
The correct statement concerning a governmental entity's statement of cash flows is option D: The statement format includes columns for the general, governmental, and proprietary fund types.
Governmental entities, such as state and local governments, follow specific accounting and reporting standards outlined by the Governmental Accounting Standards Board (GASB). One of these standards is the reporting of financial statements, including the statement of cash flows.
Unlike business enterprises, governmental entities have multiple fund types, including the general fund, governmental funds, and proprietary funds. Each fund type represents a different aspect of the entity's financial activities. Therefore, the statement of cash flows for a governmental entity includes separate columns for each fund type.
The purpose of reporting cash flows by fund type is to provide a comprehensive view of the entity's cash inflows and outflows and to allow users of financial statements to understand the cash flows specific to each fund type.
Option A is incorrect because cash flows from capital financing activities and cash flows from noncapital financing activities are not typically reported separately in a governmental entity's statement of cash flows. Instead, they are often combined within the cash flows from financing activities section.
Option B is incorrect because the statement format of a governmental entity's statement of cash flows is different from that of a business enterprise's statement of cash flows due to the inclusion of separate columns for different fund types.
Option C is incorrect because cash flows from operating activities can be reported using either the direct or indirect method in a governmental entity's statement of cash flows, similar to business enterprises.
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Refer to Instruction. What is the cost of a put option hedge for Plains States' euro receivable contract? (Note: Calculate the cost in future value dollars and assume the firm's cost of capital as the appropriate interest rate for calculating future values.)
a) $27,694
b) $26,250
c) €27,694
d)€26,250
Instruction: Plains States Manufacturing has just signed a contract to sell agricultural equipment to Boschin, a German firm, for euro 1,500,000. The sale was made in June with payment due six months later in December. Because this is a sizable contract for the firm and because the contract is in euros rather than dollars, Plains States is considering several hedging alternatives to reduce the exchange rate risk arising from the sale. To help the firm make a hedging decision you have gathered the following information. • The spot exchange rate is $1.40/euro • The six month forward rate is $1.38/euro • Plains States' cost of capital is 11% • The Euro zone borrowing rate is 9% (or 4.5% for 6 months) • The Euro zone lending rate is 7% (or 3.5% for 6 months) • The U.S. borrowing rate is 8% (or 4% for 6 months) • The U.S. lending rate is 6% (or 3% for 6 months) • December put options for euro 1,500,000; strike price $1.42, premium price is 1.5% • Plains States' forecast for 6-month spot rates is $1.43/euro • The budget rate, or the lowest acceptable sales price for this project, is $1,075,000 or $1.35/euro
Plains States' contract for euro receivables includes a put option hedge that will cost $32,193 in future value dollars. None of the available response choices correspond to this outcome.
Determine the premium payment:
Premium is equal to 1.5% of €1,500,000.
Premium equals 0.015% of 1,500,000.
Premium = 22,500 euros.
The premium amount should be converted to future value dollars using the borrowing rate for six months:
Future Value of Premium = Premium * (1 + Euro zone borrowing rate)^(6/12)
= euro 22,500 * (1 + 4.5%)^(6/12)
= euro 22,500 * (1.045)^(0.5)
= euro 22,500 * 1.022
= euro 22,995
Using the current exchange rate, convert the future value of the premium to dollars:
Future Value of Premium * Spot Exchange Rate is the price of the put option hedge.
Put Option Hedge Cost = EUR 22,995 * EUR 1.40
Put Option Hedge Cost: $32,193
Because of this, the put option hedge for Plains States' contract for euro receivables costs $32,193 in future value dollars. None of the available response options match this outcome.
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how do the 3 financial statements link together? assume the indirect method for the cash flow statement.""]
The three financial statements (income statement, balance sheet, and cash flow statement) are interconnected and provide a comprehensive view of a company's financial performance and position.
The income statement shows the company's revenues, expenses, gains, and losses, resulting in the net income or net loss. The net income or net loss from the income statement is then carried over to the balance sheet, affecting the retained earnings under shareholders' equity. The cash flow statement reconciles the net income with the cash flows from operating activities, adjusting for non-cash items and changes in working capital. The ending cash balance from the cash flow statement is linked to the cash and cash equivalents on the balance sheet.
In summary, the income statement shows profitability, the balance sheet presents the financial position, and the cash flow statement tracks cash movement. They are interconnected as the net income flows from the income statement to the balance sheet and is adjusted in the cash flow statement to reconcile cash flows.
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Jason and Kerri Consalvo, both in their 50's, have $50,000 to invest and plan to retire in 10 years. They are considering two investments. The first is a utility company common stock that costs $50 per share and pays dividends of$2.00 per share per year (a 4% dividend yield). Note that these dividends will be taxed at the same rates that apply to long-term capital gains. The Consalvos do not expect the value of this stock to increase. The other investment under consideration is a highly rated corporate bond that currently sells for $1,000 and pays annual interest at a rate of 5.0%, or $50.00 per $1,000 invested. After 10 years, these bonds will be repaid at par, or $1,000 per $1,000 invested. Assume that the Consalvos keep the income from their investments but do not reinvest it (they keep the cash in a non-interest-bearing bank account). They will, however, need to pay income taxes on their investment income. If they buy the stock, they will sell it after 10 years. If they buy the bonds, in 10 years they will get back the amount they invested. The Consalvos are in the 32% tax bracket. (Note: The tax rate on dividends for the Consalvos will be 15% and your calculations should ignore the 3.8% tax on investment income that was part of the Affordable Care Act.)
a. How many shares of the stock can the Consalvos buy?
b. How much will they receive after taxes each year in dividend income if they buy the stock?
c. What is the total amount they would have from their original$50,000 if they purchased the stock and all went as planned?
d. How much will they receive after taxes each year in interest if they purchase the bonds?
e. What is the total amount they would have from their original$50,000 if they purchased the bonds and all went as planned?
f. Based only on your calculations and ignoring other risk factors, should they buy the stock
Jason and Kerri Consalvo have $50,000 to invest. If they are planning to buy the stock which is at $50 per share, they can buy 1000 shares of the stock.
Number of shares that the Consalvo can buy = $50,000 / $50 = 1000 shares The Consalvo are planning to buy the stock which pays dividends of $2.00 per share per year. Thus the total amount that they will receive after taxes each year in dividend income if they buy the stock is:$2.00 x 1000 shares x (1-15%) = $1,700c).
The Consalvo have invested in the stock which costs $50 per share and they are planning to buy 1000 shares. Thus the total cost of the stock purchase is: $50 x 1000 = $50,000 and they will receive $1,700 every year. In 10 years, the total amount that the Consalvo would have from their original $50,000 if they purchased the stock and all went as planned will be the sum of the original investment, the interest and the dividend income over the years.
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which of the following statements are true about the pinot noir grape: a) Pinot Noir is widely planted as it adapts easily to a veriety of climatic conditions
b) Pinot Noir can be enjoyed when it is young
c)Pinot Noir produces full-body wines with strong tannins
d) Pinot Noir can withstand intense flavours from new oak
Statement (b) "Pinot Noir can be enjoyed when it is young" is true about the Pinot Noir grape.
Pinot Noir is known for its ability to be enjoyed at a relatively young age. Unlike some other red wine varieties, Pinot Noir tends to have softer tannins and lighter body, allowing it to be approachable and enjoyable in its youth. This characteristic is one of the reasons why Pinot Noir is often appreciated for its vibrant fruit flavors and delicate nuances even without extensive aging. Statements (a), (c), and (d) are not true about Pinot Noir as it is a grape that can be more sensitive to climatic conditions, generally produces lighter-bodied wines with softer tannins, and is typically not known for its ability to withstand intense flavors from new oak.
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which supreme court case ruled that the law forbids only state discrimination against blacks and that the law cannot interfere with discriminatory acts of businesses and individuals?
The Plessy v. Ferguson decision was widely criticized for upholding racial segregation and perpetuating discrimination. The decision was eventually overturned by the Supreme Court in the Brown v. Board of Education case, which declared racial segregation in public schools unconstitutional.
The Supreme Court case that ruled that the law forbids only state discrimination against Blacks and that the law cannot interfere with discriminatory acts of businesses and individuals is Plessy v. Ferguson.
In Plessy v. Ferguson, the Supreme Court upheld the constitutionality of racial segregation laws in public facilities, establishing the "separate but equal" doctrine. This doctrine allowed states to legally segregate public facilities based on race as long as the separate facilities were deemed equal in quality.
Here's a step-by-step explanation:
1. Plessy v. Ferguson was a landmark Supreme Court case decided in 1896.
2. The case centered around Homer Plessy, who was arrested for refusing to leave a Whites-only railroad car in Louisiana.
3. Plessy argued that his arrest violated the Equal Protection Clause of the Fourteenth Amendment.
4. The Supreme Court, in a 7-1 decision, upheld the constitutionality of racial segregation under the "separate but equal" doctrine.
5. The Court ruled that the law forbids only state discrimination against Blacks and that the law cannot interfere with discriminatory acts of businesses and individuals.
6. This ruling allowed states to continue implementing segregation laws in public facilities, such as schools, transportation, and public accommodations.
7. The "separate but equal" doctrine remained in place until it was overturned by the Supreme Court's decision in Brown v. Board of Education in 1954.
It is important to note that the Plessy v. Ferguson decision was widely criticized for upholding racial segregation and perpetuating discrimination. The decision was eventually overturned by the Supreme Court in the Brown v. Board of Education case, which declared racial segregation in public schools unconstitutional.
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The "right of distress" refers to a type of lease under which the landlord assumes responsibaity for certain expenses under the base rent received form the tenant. a remedy avaliable to a residential landlord if a tenant decides not to pay rent a remedy avallable to a commercial landlord if a tenant, for whatever reason, decides not to pay rent an option that may arise for a landlord during a forclosure action When an employer does not give an employee dismissal notice, the employer must provide the employee with a chance to explain
The "right of distress" does not refer to any of the options you mentioned. The term "right of distress" typically refers to a landlord's legal right to seize a tenant's property in order to recover unpaid rent or other debts owed under a lease agreement.
It is a remedy available to a landlord, usually in a commercial lease context, when a tenant fails to pay rent or other financial obligations.
In residential leases, the remedy available to a landlord when a tenant decides not to pay rent is usually an eviction or unlawful detainer process, which involves legal proceedings to regain possession of the property. The specific rules and procedures for eviction vary by jurisdiction.
Regarding your last point, when an employer terminates an employee without providing proper notice, the employer may be required to give the employee an opportunity to explain the situation or provide a reason for the dismissal.
This can be part of due process or fairness requirements in certain jurisdictions or based on specific employment contracts or labor laws. However, the specific requirements and procedures for dismissal notice and employee rights vary by country and legal jurisdiction.
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MEETINGS 11. How many meetings are required for your business on a yearly basis? Which law governs this requirement? (2 marks) 12. What is the term for when people record notes of a meeting? 2 marks) 13. Suppose that A wants to raise an issue at the meeting for the menu. Explain the steps that would be taken to formally discuss this issue towards a decision. (5 marks) CONTRACTS 14. Suppose that you want to paint the business's interior cherry red. You contract with Rolly the Painter. You agree to pay $3,500.00 to Rolly to paint the interior of the home by September 20, 2021. But Rolly is constantly delaying the paint job - making excuses for days. You get sick of it and hire another painter - Booly the Painter. a. Who has signing authority to enter into agreement with Rolly? (2 marks) b. What defence can you raise against Rolly for his delay? Explain. (2 marks) c. What costs can your recover from Rolly for hiring Booly? (2 marks)
Meetings:11. The Companies Act, 2008 states that there is no minimum or maximum number of meetings required for a company on an annual basis. The Act specifies that annual general meetings (AGMs) must be held within 6 months of the company's financial year-end and that these meetings must be attended by all shareholders.
12. Minutes are taken by people who are present at meetings. They are written records of everything that has been said and done during the meeting.13. The following steps would be taken to formally discuss an issue and reach a decision at a meeting. Step 1: Agenda for the meeting Step 2: Presentation of the problemStep 3: Clarification of the problem Step 4: Discussion and generating alternatives Step 5: Comparison and analysis of alternativesStep 6: Decision-making Step 7: Action Plan Contracts: 14.a. In this scenario, you have the signing authority to enter into an agreement with Rolly as you are the business owner.b. The defense that can be raised against Rolly for his delay is Breach of Contract. The contract was not fulfilled within the agreed time, and you had to hire another painter due to Rolly's delay. You will lose income if the place is not painted on time, and customers will avoid it because of the unpleasant appearance.
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A cross-functional team is a virtual team consisting of members from different departments in an organization. True False .A Kanban team often collects which of the following metrics? Cycletime Lead time Velocity Resource utilization .Select each pillar of Lean. Visual management Waste reduction Continuous improvement Respect for people.
A cross-functional team is not a virtual team but a team that includes members from different departments or disciplines within an organization, working together on a specific project or objective.
A cross-functional team is a group of individuals with diverse skills and expertise, representing different functional areas within an organization. These teams are formed to tackle complex problems, drive innovation, and improve collaboration across departments. By bringing together individuals from various backgrounds, cross-functional teams can leverage different perspectives, knowledge, and experiences to achieve their goals in contrast, a virtual team refers to a group of individuals who work together remotely, often across different locations or time zones, using technology to communicate and collaborate.
While virtual teams can be cross-functional, not all cross-functional teams are virtual. Cross-functional teams can operate within the same physical location, facilitating face-to-face interactions and promoting better coordination. therefore, the statement "A cross-functional team is a virtual team consisting of members from different departments in an organization" is false. Cross-functional teams can be both virtual and co-located, depending on the specific context and requirements of the project.
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CX Enterprises has the following expected dividends: $1.15 in one year, $1.23 in two years, and $1.31 in three years. After that, its dividends are expected to grow at 4.1% per year forever (so that year 4's dividend will be 4.1% more than $1.31 and so on). If CX's equity cost of capital is 12.3%, what is the current price of its stock?
The problem requires determining the current price of CX Enterprises' stock with the given information:Expected dividends $1.15, $1.23, $1.31 at the end of year one, two and three respectively.Dividend growth rate is 4.1% per year that will continue forever. CX's equity cost of capital is 12.3%.
Given information can be utilized to determine the current price of CX Enterprises' stock by applying the constant dividend growth rate formula of Gordon as shown below;Price of stock today = Dividend of next year / (r - g) + Price of stock next year Where,r is the equity cost of capital g is the dividend growth rate Dividend of next year can be determined as;Dividend of next year = Expected dividend at the end of year one * (1 + dividend growth rate)^(year difference between next year and the end of year one)
Dividend of next year [tex]= 1.15 * (1 + 0.041)^1 = $1.196[/tex] Dividend of year [tex]2 = 1.23 * (1 + 0.041)^0 = $1.23[/tex] Dividend of year 3 = 1.31 * (1 + 0.041)^0 = $1.31 Now, we can apply the formula of the constant dividend growth rate to determine the current price of CX Enterprises' stock.Price of stock today
[tex]= $1.196 / (0.123 - 0.041) + $1.23 / (1 + 0.123)^2 + $1.31 / (1 + 0.123)^3[/tex]
Price of stock today = $1.196 / 0.082 + $1.23 / 1.155 + $1.31 / 1.315 Price of stock today = $14.59
Hence, the current price of CX Enterprises' stock is $14.59.
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How
could you and your friends affect your home government's foreign
policy? Explain your answer with specific details about actions you
could take to affect change.
As an individual or a group of friends, it is possible to affect your home government's foreign policy by taking actions such as lobbying your representatives, organizing protests or rallies, using social media to raise awareness, and joining or creating advocacy groups.
By actively engaging with your representatives and making your opinions heard, you can influence their decisions on foreign policy matters. Additionally, organizing protests and rallies can attract media attention and put pressure on policymakers to take action. Social media platforms provide a powerful tool for spreading information and raising awareness about specific foreign policy issues, which can help to create a groundswell of public opinion.
Lastly, joining or creating advocacy groups can allow you to collaborate with like-minded individuals and organizations to achieve common goals, such as influencing foreign policy decisions. In conclusion, through the above actions, you and your friends can affect your home government's foreign policy in a significant way, even if it is only by a little.
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Suppose that a country has floated its currency and the central bank sets an expansionary monetary policy. Which outcome is likely to occur?
Select one:
a. Interest rates will fall and capital will flow out.
b. Interest rates will rise and capital will flow out.
c. Its exchange rate will appreciate.
d. Interest rates will fall and capital will flow in.
Expansionary monetary policy means that the central bank increases the money supply by decreasing interest rates. When a country floats its currency, exchange rates are determined by supply and demand.
Therefore, the outcome of an expansionary monetary policy is likely to be as follows: Interest rates will fall and capital will flow out. When the central bank lowers interest rates, foreign investors are likely to find it less attractive to invest in that country. Therefore, capital flows out and into countries where interest rates are higher. Additionally, this leads to a depreciation in the currency's value because less foreign investors are interested in the country's currency.
However, it is important to note that the currency depreciation will make the country's exports cheaper, which may increase demand for its goods. Nonetheless, the answer that is the most relevant to the question is a because interest rates will fall and capital will flow out. The response meets the requirement of being.
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Suppose Oscar withdraws $100 from his checking account and deposits it into his savings account. This transaction causes M1 to Multiple Choice Increase by $100 and M2 to remain the same Decrease by $100 and M2 to remain the some Decrease by $100 and M2 to increase by $100. Remain the same and M2 to increase by $100
The correct answer is: Decrease by $100 and M2 to remain the same.
When Oscar withdraws $100 from his checking account and deposits it into his savings account, it causes a decrease in M1 by $100. M1 represents the total amount of currency held by the public, including cash, travelers' checks, and checking account balances. Since Oscar withdrew $100 in cash from his checking account, M1 decreases by $100.
On the other hand, M2 represents a broader definition of money that includes M1 plus savings account balances, time deposits, and money market mutual funds. When Oscar deposits the $100 into his savings account, it does not affect M2 because it is still within the broader definition of money. Therefore, M2 remains the same.
When Oscar withdraws $100 from his checking account and deposits it into his savings account, M1 (which represents the money supply that includes physical currency, demand deposits, and traveler's checks) remains the same because the total amount of money in circulation hasn't changed. However, M2 (which includes M1 plus savings deposits, money market funds, and other time deposits) increases by $100 because the deposited amount is now included in the savings account, which is part of M2. So, the overall effect is that M1 remains unchanged while M2 increases by $100.
To summarize, the transaction causes M1 to decrease by $100 and M2 to remain the same.
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Vonder Inc, a calendar year company, established a degined benefit pension an in December 2018 . The following data relate to this plan at December 31,202 Projected benefit obligation $3,700,000 - Accumulated benifit obligation
4,700,000
3,000,000
Accumulated other comprehensive loss (OCI) 1,000,000 Unamortized prior service cost 1,600,000 Unamortized Actuarial loss 200,000 its December 31,2022 balance sheet, Wonder should report a pension liability A) $4,700,000 B) \$ 3,700,000 C) \&1,700,000 D) $1,000,000 E) $700,000
Wonder should report a pension liability of $1,700,000 at December 31,2022 balance sheet.
Explanation:
The accumulated benefit obligation at December 31,2020 is $3,000,000 and projected benefit obligation is $3,700,000.
The difference between the two amounts is the unrecognized net actuarial loss of $700,000. In addition, there is prior service cost of $1,600,000 that has not been amortized yet.
This gives us a total of $2,300,000. Since the company has a net pension asset of $1,000,000, this reduces the total pension liability to $1,300,000.
However, the company also has an accumulated other comprehensive loss of $1,000,000. This means that the total pension liability that Wonder should report on its balance sheet at December 31,2022 is $1,700,000 (i.e. $1,300,000 + $1,000,000).
The correct option is C) $1,700,000.
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CH 10 KB. What budgeted amounts appear on the flexible
budget?
Original budgeted amounts at the static budget activity
level
Actual costs for the estimated activity level
Actual costs for the budgeted
The budgeted amounts that show up on the flexible budget are dependent on the initial budgeted amounts at the static budget activity level. These initial budgeted sums are modified by the flexible budget to account for the actual costs associated with the anticipated activity level.
The flexible budget's goal is to report expenditures in a more precise manner based on the actual level of activity attained. To analyse and evaluate the success of the business, the actual costs for the projected activity level are contrasted with the flexible budget amounts. It is possible to investigate any differences between the flexible budget amounts and the actual expenditures in order to determine the causes of the variations and take the necessary action. In conclusion, the flexible budget includes the initial budgeted sums at the fixed This enables more precise performance assessment and decision-making by taking the expected expenses for the estimated activity level and adjusting them to match the actual costs for that activity level.
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The present value equals the future value when ... Select one: a. none of the above b. Interest rate is lower than zero c. interest rate is higher than zero d. interest rate is zero
The present value equals the future value when the interest rate is zero. When there is no interest rate involved, the present value and the future value of an investment are the same. The correct option is c.
Present value (PV) is the value today of a cash flow or series of cash flows in the future. The future value (FV) is the value that a series of cash flows will have at a specified date in the future, given a specified interest rate. The present value (PV) and future value (FV) of an investment are related to each other by an interest rate, time period, and a compounding period.
To calculate present value, we discount the future cash flows using a discount rate, which is the interest rate that is used to calculate the present value of an investment. Future value, on the other hand, involves calculating how much an investment will be worth at a specified time in the future, given a specific interest rate. The relationship between the present value and the future value of an investment is inverse.
As the present value of an investment increases, the future value decreases, and vice versa. The interest rate plays a crucial role in determining the present value and future value of an investment. In conclusion, the present value equals the future value when the interest rate is zero. The correct option is c.
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mb global has a mv d/e ratio of 0.73. mb's cost of equity is 15% and the ytm on mb's bonds is 9.5%. the company has a tax rate of 30%. what is mb's weighted average cost of capital (wacc)?
The weighted average cost of capital (WACC) for MB Global is roughly 10.66%.
WACC is calculated as (E/V)* Ke + (D/V)* Kd * (1 - Tax Rate).
Where:
E/V = Proportion of equity in the capital structure
Ke = Cost of equity
D/V = Proportion of debt in the capital structure
Kd = Cost of debt
Tax Rate = Corporate tax rate
To find the proportions of debt (D/V) and equity (E/V)-
D/V = D / (D + E)
E/V = E / (D + E)
Since D/E ratio = 0.73,
D/V = 0.73 / (1 + 0.73)
E/V = 1 / (1 + 0.73)
Let's calculate these values:
D/V = 0.73 / (1 + 0.73) = 0.73 / 1.73 ≈ 0.422
E/V = 1 / (1 + 0.73) = 1 / 1.73 ≈ 0.578
Now substituting these values into the WACC formula:
WACC = (E/V) * Ke + (D/V) * Kd * (1 - Tax Rate)
= 0.578 * 0.15 + 0.422 * 0.095 * (1 - 0.30)
= 0.0867 + 0.0284 * 0.70
= 0.0867 + 0.01988
≈ 0.1066 or 10.66%
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10.2a With 20-20 hindsight, what was the best investment for the period 1926–1935?
10.2b Why doesn’t everyone just buy small stocks as investments?
10.2c What was the smallest return observed over the 89 years for each of these investments? Approximately when did it occur?
10.2d About how many times did large stocks (common stocks) return more than 30 percent? How many times did they return less than −20 percent?
10.2e What was the longest "winning streak" (years without a negative return) for large stocks? For long-term government bonds?
10.2f How often did the T-bill portfolio have a negative return?
10.2a:With 20-20 hindsight, small stocks were the best investment for the period 1926-1935.10.2b: Everyone does not buy small stocks as investments because these stocks are more risky and have high variability in the returns.
10.2c:The smallest return observed over 89 years for small stocks was -36.9%, which occurred in 1932. The smallest return observed for long-term government bonds was -8.1% and it happened in 1969.10.2d: Large stocks (common stocks) returned more than 30 percent 26 times.
They returned less than -20 percent 6 times.10.2e:The longest winning streak (years without a negative return) for large stocks was 17 years, from 1949 to 1965.
For long-term government bonds, the longest winning streak was 33 years, from 1927 to 1959.10.2f:The T-bill portfolio had a negative return in 5 years out of 89. The negative returns occurred in
1930, 1931, 1932, 1938, and 1941.
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Dwight Donovan, the president of Rooney Enterprises, is considering two investment opportunities. Because of limited resources, he will be able to invest in only one of them. Project A is to purchase a machine that will enable factory automation; the machine is expected to have a useful life of three years and no salvage value. Project B supports a training program that will improve the skills of employees operating the current equipment. Initial cash expenditures for Project A are $113,000 and for Project B are $43,000. The annual expected cash inflows are $53,644 for Project A and $17,903 for Project B. Both investments are expected to provide cash flov benefits for the next three years. Rooney Enterprises' cost of capital is 6 percent. (PV of $1 and PVA of $) (Use appropriate factor(s) from the tables provided.) ints Required Required a Compute the net present value of each project. Which project should be adopted based on the net present value approach? b. Compute the approximate internal rate of return of each project. Which one should be adopted based on the Internal rate of return eBook Print approach? eferences Complete this question by entering your answers in the tabs below Required A Required B Compute the net present value of each project. Which project should be adopted based on the net present value approach? (Round your final answer to 2 decimal places) Project A Project B Which project should be adopted? Required B
We must use the cost of capital (6%) to discount the anticipated cash inflows and deduct the initial cash outlays in order to calculate the net present value (NPV) of each project.
a) Calculating Net Present Value (NPV) A Project Year 1: $53,644 / (1 + 0.06)^1 = $50,637.74 Year 2: $53,644 / (1 + 0.06)^2 = $47,762.40 Year 3: $53,644 / (1 + 0.06)^3 = $45,017.79 NPV(A) = -$113,000 + $50,637.74 + $47,762.40 + $45,017.79 = -$19,581.07 Year 1 of Project B: $17,903 / (1 + 0.06)1 = $16,896.23 Year 2: $17,903 / (1 + 0.06)^2 = $15,950.21 Year 3: $17,903 / (1 + 0.06)^3 = $15,051.71 NPV(B) = -$43,000 + $16,896.23 + $15,950.21 + $15,051.71 = $5,898.15 A greater NPV project ought to be chosen based on the net present value strategy. In this instance, Project B ought to be chosen since NPV(A) is negative ($19,581.07) and NPV(B) is positive ($5,898.15).b) To We can utilise financial tools or trial and error to roughly estimate the internal rate of return (IRR) for each project. The discount rate that brings the NPV to zero is known as the IRR. According to a financial calculator or piece of software, the IRR for Project A is approximately 5.36%, whereas the IRR for Project B is approximately 10.93%. The project with the greater internal rate of return should be chosen based on the internal rate of return strategy. In this instance, Project B should be chosen because it has a greater IRR (10.93%) than Project A (5.36%). In conclusion, Project B should be used, according to both the internal rate of return and net present value methods.
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Assuming the expectations theory is the correct theory of the term structure, calculate the interest rates in the term structure for Indian government maturities of one to five years, and describe the resulting yield curves for the following paths of one-year interest rates over the next five years:
a. −0.2%, −0.1%, 0%, 0.1%, 0.2%
b. 0%, −0.2%, −0.3%, −0.2%, 0%
How would your yield curves change if people preferred shorter-term bonds over longer-term bonds?
The expectation theory is a theory of the term structure of interest rates that holds that the interest rate on a long-term bond will equal an average of the short-term interest rates expected to occur over the life of the long-term bond, assuming the market is in equilibrium and expectations are based on all available information.
Thus, if the expectation theory is the correct theory of the term structure, the interest rates in the term structure for Indian government maturities of one to five years can be calculated, and the resulting yield curves for the given paths of one-year interest rates over the next five years can be described as follows:
a. -0.2%, -0.1%, 0%, 0.1%, 0.2%The yield curve for this path of one-year interest rates over the next five years will be upward sloping.
b. 0%, -0.2%, -0.3%, -0.2%, 0%
The yield curve for this path of one-year interest rates over the next five years will be downward sloping. If people preferred shorter-term bonds over longer-term bonds, the yield curves would be flatter, as the demand for long-term bonds would decrease, leading to a decrease in the price of long-term bonds and an increase in their yield, while the demand for short-term bonds would increase,
leading to an increase in the price of short-term bonds and a decrease in their yield. Thus, the yield curve would become flatter, with the yield on short-term bonds rising less than the yield on long-term bonds.
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Managers wishing to build cohesive teams with high performance norms should Group of answer choices focus more on performance than cohesion. keep the team as small as possible. take credit for team successes. tie rewards to individual performance. recruit members with dissimilar attitudes and values.
Managers wishing to build cohesive teams with high performance norms should focus more on performance than cohesion. To achieve the highest performance norms, it's important to make sure everyone on the team is working toward the same goals and standards.
Focusing solely on cohesion can result in team members becoming too comfortable with each other and not striving for excellence. Keeping the team as small as possible is helpful as long as it doesn't negatively impact performance. The larger the team, the more difficult it is to coordinate everyone's efforts and ensure that everyone is on the same page.
Taking credit for team successes can be tempting, but it's important to recognize the contributions of all team members. Tie rewards to individual performance rather than group performance. This motivates each team member to perform at their highest level and ensures that those who contribute the most are recognized and rewarded appropriately. Recruiting members with dissimilar attitudes and values can be beneficial because it brings new perspectives and ideas to the team. However, it's important to ensure that everyone is still working toward the same goals and standards.
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You wish to see employee satisfaction in a store that has several branches in your county. Among the questions you ask the employees is: How many years have you worked here. The results are: 3, 27, 12, 1, 19, 31, 5, 15, 8, 22 Will increasing the sample size help solve the problem?
Increasing the sample size may help provide a more accurate understanding of employee satisfaction in the store.
By collecting data from a larger number of employees, we can reduce the impact of outliers and get a more representative picture of the overall sentiment. In this case, the given sample consists of 10 employees with varying years of service. With a larger sample size, we can capture a wider range of experiences and potentially identify any trends or patterns that might exist among employees with different lengths of employment. Therefore, increasing the sample size can enhance the reliability and validity of the findings, leading to a more comprehensive analysis of employee satisfaction.
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The auditing firm of Samuels, Muir, Malcolm and Associates is recruiting persons to be a part of the audit team, to audit the books of several of its audit clients. Applications were received from qualified auditors and recent university graduates. The partners are concerned that the panel of interviewers must pay careful attention to the qualifications of applicants, and diligence must be carried out to ensure that short listed applicants are conforming to the Code of Ethics for Auditors.
During the process of interviewing the applicants, the panel discovered that Nardia Sinclair, a qualified auditor, was a recent employee of one the firm’s audit client and that she was employed by the client as its Chief Financial Officer. It was also discovered that Dexanne McDonald, a recent university graduate, had a 25% shareholding in a company that the auditing firm, of Samuels, Muir, Malcolm and Associates will be auditing. The members of the panel were impressed with these two candidates and would want to offer them employment but are concerned about the prevailing issues.
Assuming that you were one of the panalists conducting the interview, provide plausible reasons why you would advise the entire panel of interviewers to eith make or not to make a job offer to Nordia Sinclair and Dexanne McDonald.
If I were one of the panelists conducting the interview, I would advise the entire panel of interviewers not to make a job offer to Nardia Sinclair and Dexanne McDonald. The reason for this is that both candidates have issues that may lead to a conflict of interest and possibly result in ethical breaches.
Nardia Sinclair was a Chief Financial Officer of one of the audit client's firm. She may have access to sensitive financial information that she could use to influence the audit in favor of her previous employer. This situation poses a significant threat to the auditor's independence, which is one of the fundamental principles of the code of ethics for auditors. The auditor must be independent and free from any influence from the client, whether it is financial or otherwise.
The panel should not make a job offer to Nardia Sinclair and Dexanne McDonald due to the potential ethical threats that they pose to the auditing firm. Instead, the firm should continue its recruitment process and consider other qualified candidates who do not pose any threats to the firm's independence or objectivity.
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