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elixir [45]
1 year ago
15

You are a professor of economics at a university.​ You've been offered the position of serving as department​ head, which comes

with an annual salary that is $7,500 higher than your current salary.​ However, the position will require you to work 200 additional hours per year. Suppose the next best use of your time is spending it with your​ family, which has value of $10 per hour.
The change in net benefit is $___
Business
1 answer:
Alisiya [41]1 year ago
7 0

Answer:

$5,500

Explanation:

Given that,

Increase in salary from switching a job = $7,500 but have to invest additional 200 hours per year

and the opportunity cost of spending this time with the family:

= $10 per hour × 200 hours

= $2,000

Therefore, the net benefit is as follows:

= Amount of increase in salary - opportunity cost

= $7,500 - $2,000

= $5,500

Hence, the change in net benefit is $5,500.

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Which of the following is not a recognised type of plan?
makvit [3.9K]

Answer:

Ad hoc

Explanation:

Ad hoc is not a recognized type of plan. The following are plans that are 100% recognizable:

Business plan, Succession plan and Financial plan.

Ad hoc is a Latin word which means "for this" or "for this situation". In English, it is used to explain what has been formed for a special purpose without planning.

3 0
1 year ago
Dave plans to deposit $3,300 in an IRA account on April 15, Year 1. The account will earn 3% annually. If he makes this $3,300 d
hjlf

Answer:

63218

Explanation:

Annuity -3300

FVAD (from table) at 15years, 3% = 19.1569

Future value = 63217.77=63218

7 0
1 year ago
A hospital benchmarked against a ferrari racing team in an effort to:
Rus_ich [418]
<span>improve patient handoff quality</span>
5 0
1 year ago
Which of the following could be used as a basis to allocate profits among partners who are active in the management of the partn
grandymaker [24]

Answer:

1, 2, 3 & 4

Explanation:

All of the given options could be used as a basis to allocate the profit among partners. Allocation of salaries is also a basis for profit allocation. Salaries of partner is deducted from the net profit on the basis of predetermined ratio or amounts.

The numbers of years can also be a base for the profit allocation. The partner from the long time could have more share than a new partner but it depends on the agreement of all the partners.

The profit can also be based on the the amount of work work done or time spent by each partner. Some associations and firms use this method to allocate the profit.

The most common method of profit allocation is the capital invested in the business. partners are paid on the basis of what they invested in the business.

5 0
2 years ago
Masterson, Inc., has 4.1 million shares of common stock outstanding. The current share price is $84, and the book value per shar
Kitty [74]

Answer:

The answer is "8.37%".

Explanation:

\text{MV of equity} = \text{equity price}  \times \text{number of outstanding shares}

                     =84 \times 4100000\\\\=344400000

\text{MV of Bond1}=\text{Par value} \times \text{bonds outstanding} \times \text{age of percentage}

                      =1000 \times 70000 \times 0.98 \\\\=68600000

\text{MV of Bond2}=\text{Par value} \times \text{bonds outstanding} \times \text{age of percentage}

                      =1000 \times 50000 \times 1.08 \\\\=54000000

\text{MV of firm} = \text{MV of Equity} + \text{MV of Bond1}+ \text{MV of Bond 2}

                  =344400000+68600000+54000000\\\\=467000000

\text{Weight of equity W(E)} = \frac{\text{MV of Equity}}{\text{MV of firm}}

                                     = \frac{344400000}{467000000}\\\\=0.7375

\text{Weight of debt W(D)}= \frac{\text{MV of Bond}}{\text{MV of firm}}

                                  = \frac{122600000}{467000000}\\\\=0.2625

Equity charges

By DDM.  

\text{Price = new dividend} \times  \frac{(1 + \text{rate of growth})}{( \text{Equity expense-rate of growth)}}

84 = 3.95  \times  \frac{(1+0.05)}{(\text{Cost of equity}- 0.05)}\\\\84 = 3.95  \times  \frac{(1.05)}{(\text{Cost of equity} - 0.05)}\\\\84 = \frac{4.1475}{ (\text{Cost of equity} - 0.05)}\\\\\text{Cost of equity} -0.05 = \frac{4.1475}{84}\\\\\text{Cost of equity} -0.05 = 0.049375\\\\\text{Cost of equity}  = 0.049375 + 0.05\\\\\text{Cost of equity}  = 0.099375 \\\\\text{Cost of equity} \%  = 9.9375 \% \ \ \ or  \ \ \ 9.94 \%  \\\\

Debt expenses  

Bond1

K = N \times 2 \\\\

Bond \ Price = \sum  [ \frac{\text{(Semi Annual Coupon)}}{(1 + \frac{YTM}{2})^k}]     +   \frac{Par\  value}{(1 + \frac{YTM}{2})^{N \times 2}}

k=1\\\\K =20 \times 2\\\\980 = \sum  [ \frac {(5.1 \times \frac{1000}{200})}{(1 + \frac{YTM}{200})^k}] +   \frac{1000}{(1 + \frac{YTM}{200})}^{20 \times 2}\\\\k=1\\\\\ YTM1 = 5.2628923903\\\\Bond2\\

K = N \times 2

Bond \ Price = \sum  [ \frac{\text{(Semi Annual Coupon)}}{(1 + \frac{YTM}{2})^k}]     +   \frac{Par\  value}{(1 + \frac{YTM}{2})^{N \times 2}}

k=1\\\\K =12 \times 2\\\\

1080 =\sum [\frac{(5.6 \times \frac{1000}{200})}{(1 + \frac{YTM}{200})^k}] +\frac{1000}{(1 +\frac{YTM}{200})^{12 \times 2}} \\\\k=1\\\\YTM2 = 4.72\\\\

\text{Company debt costs} = YTM1 times \frac{(MV \ bond1)}{(MV \ bond1+MV \ bond2)}+YTM2 \times \frac{(MV \ bond2)}{(MV \ bond2)}\\\\

The cost of the debt for the company:

= 5.2628923903 \times \frac{(68600000)}{(68600000+54000000)}+4.72 \times \frac{(68600000)}{(68600000+54000000)}\\\\

Business debt cost=5.02 \% \\\\

after taxation cost of debt:  

= \text{cost of debt} \times (1- tax \ rate)\\\\= 5.02 \times (1-0.21)\\\\= 3.9658\\\\

WACC= \text{after debt charges} \times W(D)+equity cost  \times W(E) \\\\

            =3.97 \times 0.2625+9.94 \times 0.7375 \\\\ =8.37 \% \\\\

7 0
2 years ago
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