Answer:
Check the explanation
Explanation:
Check the attached image below for:
1) Value of equity = EBIT x (1 - tax) / Cost of equity
2) Stock Price
3) PV of tax shield
Value of the firm
4) Price per share
5) No. of shares repurchased
6) New price
7) Value of equity = (EBIT - Interest) x (1 - tax) / Cost of equity
Answer:
D. The market value of the bond approaches its par value as the time to maturity declines. The yield to maturity approaches the coupon interest rate as the time to maturity declines.
Explanation:
One explanation of the relationship that exists between the coupon interest rate and yield to maturity and the par value and market value of a bond, is that <u>the market value of the bond approaches its par value as the time to maturity declines. The yield to maturity approaches the coupon interest rate as the time to maturity declines.</u>
According to the definition of yield to maturity, it takes into consideration the coupon rate (i.e. the interest amount earned per year) for the number of years left to maturity, it is often higher because it treats the amount earned each year as being re-invested.
<u>Therefore the amount of yield to maturity will fall as the time to maturity nears and will approach the coupon rate</u>
Secondly, A bond's par value is the dollar amount it will be worth when it reaches maturity.
Before its maturity date, the bond may sell for more than par value on the secondary market as the yield it pays becomes more attractive to buyers.
<u>Therefore the difference between par value and market value is the yield. hence as maturity nears, yield to maturity falls and market value approaches par value because the bond is what its par upon maturity.</u>
Explanation:
They're never secure in making a financial decision and thus rely in large measure on the relationship between return, risk and stock value. A return defines the gain assured on assets for which the risk of default or potential loss is borne. Consequently, the risk and returns are negative. If the risk investment is high, there will also be higher returns, as the buyer needs to be balanced against bearing the higher risk in the form of dividends.On the other hand, if you are looking for a low-risk investment, the income is less. The stock and returns on the other side contribute favourably. The market value of the stock decreases as returns rise. Although no clear link is established, it appears that investments that have the highest return potential are often the most risky. Such partnerships are of particular significance to an investor because he will have two main concerns, one being the rate of return and the other being the risk. The returns of stocks are practically limitless as they can become worthless or have a significantly higher valuation over time than the initial buying price. Acquisition stocks are also more volatile than shares, because in comparison to debt the yield on stocks is not decided. And therefore it would be right to say that such partnerships are part of the investment method.
Any reactive financial manager or investor prefers without the guarantee of a higher profit to escape higher risk. In handling the company's assets and obligations a finance officer takes these partnerships into account on a regular basis. It can be decided on the basis of this correlation whether or not it is worth risking an investment that could be lucrative.
Answer:
The closing balance from the excel sheet is $5,000.00
Explanation:
Solution
Given that:
The loan balance required l for each month can be computed as follows:
The loan balance = additional cash needed – cash used to retire debt + loan balance from previous month
Now
By applying the excel formula to perform this task is stated as follows:
D34 = SUM(D31-D33,C34)
The same formula is used to get the values for E34 to I34.
Kindly find an attached copy of the updated excel sheet after applying above formula which is a part of the solution is as follows:
Answer: A. If Leandro chooses to consume 8 hours of leisure, then his income would be $320
Explanation:
As the question states that Leandro spends 8 hours out of 16 hours in leisure time. If Leandro spends all the 16 hours in work he would earn (16 x $20) = $320.
I have attached the picture of the graph for understanding.
