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2 years ago

Which one of the following statements is INCORRECT concerning the equity component of the WACC?

Business

1 answer:

Pachacha [2.7K]2 years ago

6 0

Answer:

D. There is a tax shield on the dividends paid

Explanation:

WACC is the weighted average cost of capital.

A. The equity component of WACC reflects the return expected by the company’s shareholders - CORRECT

The weighted average cost of capital formula has equity and cost of equity. The latter is the shareholder's required return.

B. Market values should be used in calculating WACC - CORRECT

Market values(and not Book values) of common equity, preferred shares, and debt are used in calculation os WACC.

C. Preferred equity is a separate component of WACC - CORRECT

If a company uses preferred equity in its capital structure, then it is included in the calculation of its WACC.

D. There is a tax shield on the dividends paid -INCORRECT

Tax shield only applies to interest rates paid on debt.

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Instructions: Round your answers to 2 decimal places. If you are entering a negative number include a minus sign. a. Using the m

BabaBlast [244]

Answer:

The answer is below

Explanation:

The graph is attached below.

a) The price elasticity of demand is given by:

price elasticity of demand = $\frac{\%\ change\ in\ quantity }{\%\ change\ in\ price}=\frac{\Delta Q}{\Delta P}$

$\Delta Q=\frac{Q_2-Q_1}{(Q_2+Q_1)/2} \\\\\Delta P=\frac{P_2-P_1}{(P_2+P_1)/2}$

Price of elasticity demand = $\frac{\frac{Q_2-Q_1}{(Q_2+Q_1)/2} }{\frac{P_2-P_1}{(P_2+P_1)/2} }$

Price of elasticity demand = $\frac{\frac{50-100}{(50+100)/2} }{\frac{4.5-4}{(4.5+4.0)/2} }=\frac{-0.6667}{0.1176} =5.7$

Since the price of elasticity demand > 1, it is elastic

b) Price of elasticity demand = $\frac{\frac{200-300}{(200+300)/2} }{\frac{3-2}{(3+2)/2} }=\frac{-0.4}{0.4} =1$

Since the price of elasticity demand = 1, it is unitary

c) Price of elasticity demand = $\frac{\frac{400-450}{(400+450)/2} }{\frac{1-0.5}{(1+0.5)/2} }=\frac{-0.1176}{0.6667} =0.18$

Since the price of elasticity demand < 1, it is inelastic

6 0

2 years ago

1. OB helps managers explain, predict, and influence behavior in the workplace. Identify behaviors that you are most interested

SashulF [63]

Answer:

Part 1).

The behavior that I am most involved in amplification, forecasting and persuading in the office is motivation between the team followers and staffs.

One the key persistence of association behavior is to manage staffs efficiently. This means that the employee administration is a large part of OB. In doing that administrations need to employee competent personnel and make sure they are sufficiently motivated. While the motivation can be of diverse types (internal and external), the administration of the motivation is what makes staffs efficient and creative. Thus in order to achieve effectiveness and productivity on association level, I believe it is significant to manage worker motivation efficiently.

There are various representations that can be used for this determination. For example, Maslow’s hierarchy, Herzberg’s’ theory, etc.

Part 2).

One of the significant steps to eliminate biases and preconceptions is to admit their presence and to vigorously avoid them. The staffs should receive discernment and diversity training on a regular basis. In addition to this stages of possible judgement/bias such as signing, raises, task, etc. needs to be totally objective. The valuation of staffs or possible personnel should follow objective procedure and assessment criteria.

This should allow plummeting, if not removing, the bias and judgement in the day to day process of the team and the association.

7 0

2 years ago

a wifi router has a mtbf of 10 months. What is the availability if the mttr is 12 hours and the number of days in a month is 30

Angelina_Jolie [31]

Answer:

Explanation:

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1 year ago

Read 2 more answers

After graduation, you plan to work for Dynamo Corporation for 12 years and then start your own business. You expect to save and

ExtremeBDS [4]

Answer:25,000 in 12 years = 25,000*(1.09)^12= $70,316

Value of $7,500 deposits in 6 years

Use financial calculator and input these values

N=6

PV=0

PMT=7,500

I=9

Compute FV= 56,425, after this

PV= 56,425

PMT= 15,000

I=9

N=6

Compute FV=$ 207,480

We will have (207,480+ 70,316) = $277,796 in 12 years to start our business.

Explanation:

4 0

2 years ago

Joel was recently hired as a police officer in his city's police department. As part of employee training, his supervisor trains

Assoli18 [71]

Answer:

On-the job training.

Explanation:

This is explained to be normal emphasized training that working staffs are seen to undergo; especially newly employed staffs, which is a direct training while doing the actual job they are been hired or paid for. A a good and reasonable trainee in this aspect is seen to be appreciative when given this chance to develop knowledge and skills without ever leaving work. In this employee training format, employees are seen to receive your workplace needs, norms, and culture and familiarize with them. Internal job training and employee development bring a special plus. This is why in the scenario above, Joel's supervisor trains him off-site on the use of firearms.

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2 years ago