Answer:
b. An increase of $15 million
Explanation:
The computation of the cash impact of the change in working capital is shown below:
As we know that
Working capital = Current assets - current liabilities
So, the change in working capital is
= Increase in current assets - increased in current liabilities
= $40 million - $25 million
= $15 million
Hence, the b option is correct
Answer:
Since the company's debt level is very low, then it should probably issue new debt. The advantage of issuing debt is that debt is always cheaper than equity. E.g. the company issues a bond with a 10% coupon rate and the corporate tax rate is 30%. The after tax cost of debt = 10% x (1 - 30%) = 7%.
Issuing bonds with a 10% coupon rate is not something impossible, and actually the interest rate is pretty high. Some companies issue bonds at 4 or 5%. But to raise new capital offering a return on equity of 7% or less is extremely odd and difficult. Generally, the cost of equity of normal corporations tends to be about twice as higher as the cost of debt.
Answer:
Average hourly output is 13.14 pieces.
Explanation:
Number of machines at the bank N = 5
Average service time T = 26 min
Machine runs for an Average R = 74 min
Number of servers M = 1
Service Factor, X = T / (T+R)
= 26 / (26+74)
= 0.26
Efficiency Factor, F = 0.683
Average Number of machine running A = N * F * (1 - X)
= 5 * 0.683 * (1 - 0.26)
= 2.52
Output rate = 26 * (A / N)
= 26 * ( 2.52 / 5)
= 13.14 per hour.
Answer:
b. a branding strategy in which a company uses one name for all of its products in a product class.
Explanation:
Multi-product branding is a branding strategy in which a company uses one name for all of its products in a product class.
Multi-product branding is a business strategy widely used by manufacturers, it involves producing and selling multiple products using the same brand name for all.
For instance, Pears may have Pears diapers, clothing lines, lipstick ranges, shoes, body lotions, eye shadow, foundation etc. They are all different products manufactured and all branded as Pears.
The merits and advantages of Multi-product branding is high brand awareness, low promotional and advertising costs, and brand equity return.
Answer: Focused cost leadership
Explanation:
Focused cost leadership could be described as targeting your market to a category of people only and not necessarily everyone. Some businesses do have a target market in mind when carrying out their production or sales. Their product isn't for everyone but this particular persons. They could design it from a normal general product but they will make it look perculiar and specific for this targeted market.
