Answer:
The projects which maximize Vanguard's shareholder wealth are Project A; Project B; Project D.
Explanation:
Projects which maximize the shareholder value are projects delivering Expected Returns which are higher than its risk-adjusted weighted average cost of capital (WACC).
As a result, Project A with Expected return of 15% and risk adjusted WACC of 12%; Project B with Expected return of 12% and risk adjusted WACC of 10%; Project D with Expected return of 9% and risk adjusted WACC of 8%; are the projects that maximize the shareholder's value.
On the other hand, Project C with Expected return of 11% and risk adjusted WACC of 12% is harmful to shareholder value.
Answer:
Exporting.
Explanation:
Exporting is the process where goods and sert are produced on one country and sold to buyers in another country. Usually contries produce goods they in which they incur low cost compared to other countries for export.
Home of households produces smaller washers and dryers for countries where consumers have less living space. So they are exporting.
Answer:
d. $277,797
Explanation:
Savings = $7,500 for the first 6 years (t = 1 through t = 6)
Deposits = $15,000 for the following 6 years (t = 7 through t = 12)
Gifts = $25,000
Earnings = 9% annually
Calculation of the Final Amount by Savings, Deposits and Gifts:
Amount at the end of year 6
Interest rate 9.0%
1st Annuity (Savings) $7,500 $56,425 - Compounded at 9% 2nd Anuuity (Deposits) $15,000 NA
Gift $25,000 NA
Total Years 12
Annuity years 6
Amount at the end of year 12
$94,630
$112,850
$70,317
Final Amount: $277,797
Therefore, $277,797 is the final amount which you will have when you start your business 12 years from now.
Answer: In a market served by a monopoly, the marginal cost is $60 and the price is $110. In a perfectly competitive market, the marginal cost is $60. If the marginal cost increased from $60 to $75, the monopoly would raise its price <u>by less than $15</u>, and the price in the perfectly competitive market would <u>increase to $75.</u>
Explanation: The monopolist attends to the market demand, therefore the choice of the monopolist is limited by the market demand. If you set a very high price, you will only sell the amount that the demand you want to buy at that price, so it will only increase by less than $ 15.
In a market of perfect competition the companies are accepting price and will produce until the price is equal to the marginal cost so the price would rise to $ 75.
