auto care has a pretax cost of debt of 6.6 percent and an unlevered cost of capital of 14.6 percent. the firm's tax rate is 34 percent and the cost of equity is 15.8 percent. what is the firm's debt-equity ratio?

Answers

Answer 1

The firm's debt-equity ratio is 0.23 with cost of debt 6.6 percent, cost of capital as 14.6 percent and firm's tax rate as 34 percent.

Write a short note on debt-to-equity ratio.

The D/E ratio, commonly referred to as the debt-to-equity ratio, gauges a company's capacity to pay down its debt. It is calculated by dividing an organization's total debt by the total of its shareholders' equity. The higher the D/E ratio, which shows how much debt a company has compared to its assets, the harder it may be for the company to fulfill all of its obligations.

It's crucial to know precisely which debt and equity categories are taken into account on your balance sheets because the debt-to-equity ratio can be calculated in a number of different ways. The debt-to-equity ratio is a popular tool used by banks and other lenders to determine how much debt a company may have.

To solve the question :

Converting percent into decimal :

Cost of equity = 15.8 percent × 100

=0.158

Cost of capital = 14.6 percent × 100

= 0.146

Cost of debt = 6.6 percent × 100

= 0.066

Cost of equity (RE) = Cost of capital + (Cost of capital - Cost of debt ) × D/E × (1 - firm's tax rate)

RE = .158 = .146 + (.146 - .066) × D/E ×(1 - .34)

D/E = .23

Therefore, firm's debt-equity ratio is 0.23.

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Related Questions

which of the following is the defining feature of the proletariat in the marxist view of society? a lack of ownership of the means of production control of the media and other social institutions an absence of class consciousness ownership of capital used in production

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Lack of ownership one of the main problems with lack of ownership is the slow progress of various initiatives. If no one feels they own the project, no one will move it forward and it will eventually stagnate.

But taking responsibility for your life also builds character, courage, and self-esteem. By choosing how to respond to situations with responsibility and firmness, you can actively create a full, meaningful, and healthy life. Ownership is the state of owning something. Anything that people own or own gives them the quality of ownership. Wars are often fought over land ownership.

Finally, being responsible is important. Because it builds trust, support and bonds with people you care about. No team can thrive without a culture of accountability. This culture brings everyone together to work towards a defined company mission.

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Broke benjamin co. has a bond outstanding that makes semiannual payments with a coupon rate of 5.9 percent. the bond sells for $985.72 and matures in 15 years. the par value is $1,000. what is the ytm of the bond?

Answers

0.06101= 6.101% the bond’s yield till maturity is 6.101%.Using the YTM formula,YTM =C + (fv-pv) /n (fv+py) /2 C = coupon rate =5.7% of par value.The answer is 6.101%.

5.7/100 times 1,000 equals $57; PV, or price value, is $962.62; Fy, or face value, is $1,000.

13 years until maturity, therefore n = n.

With the previously mentioned formula, C+(fv- pv)/n = 57 + (1000-962.62) /13 57 + (37.38) / 13 = 59.8753846

( Fv+ pv) /2 = 1000 plus 962.62 / 2 = 1962.62 / 2 = 981.31 YTM = C+ (fv – pv) /n (fv + pv) /2 YTM = 59.8753846 / 981.31 YTM = 0.06101 (to percentage) = 6.101%

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if suppliers were to be rated on the following basis, what would be the ranking of the two suppliers listed?

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A person, business, or organization that sells or provides goods or equipment to customers is a supplier.

What is an illustration of a supplier?

A person, company, or other entity that provides goods or services to another entity is a supplier. One example of a supplier is a business that sells PCBAs to OEMs or laptop manufacturers.

Rank of Supplier A = (7*8+5*9+4*5+1*8)/(7+5+4+1) = 56+45+20+8/17 = 129 Rank of Supplier B = (7*9+5*5+4*7+1*4)/17 = 63+25+28+4/17 = 120 Rank of Supplier C = (weight of function*rating+ weight of cost*rating+weight of technical assistance*rating+weight of credit terms*rating

Weight A's ratings B's ratings B's ranking (weight *rating) Function 7 8 9 56 63 Cost 5 9 5 45 25 Technical assistance 4 5 7 20 28 Credit terms 1 8 4 8 4 Total rank 129 120

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Full Question = If suppliers were to be rated on the following basis, what would be the ranking of the two suppliers listed?

Rating of Suppliers Ranking of Suppliers

Factor Weight Supplier A Supplier B Supplier A Supplier B

Function 7 8 9

Cost 5 9 5

Technical Assistance 4 5 7

Credit Terms 1 8 4

A minimum viable product is a prototype used to test ease-of-use and______
A. performance
B. viability
C. functionality
D. cost

Answers

Answer:

functionality C

Explanation:

A minimum viable pro-duct is a prototype used to test ease-of-use an-d functionality.

While a PoC on-ly investigates the product's one asp-ect, a prototype models seve-ral aspects of the product. Usu-ally, the develop-ment team uses proto-types to discover errors in the pro-duct. By creating a prototype, they can te-st the product's design, usa-bility, and oft-en functionality.

What is a minimum viable prototype ?

A minimum viable proto-type is the least amo-unt of effort and a general-ized approach to build-ing a prototype. It will be the first st-ep to becoming more comfort-able with incorp-orating prototyping into your day to day w-ork.

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question number 1) you have developed a new product and have created a website where customers can go to order the product. which type of channel are you most likely utilizing?

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When you have developed a new product and have created a website where customers can go to order the product, it is called Direct Channel.

A manufacturer can reach consumers directly through this channel by selling goods like hardware, software, and accessories:

• Direct sales force — This is a distribution method where goods are sent directly from the manufacturer or supplier to the final customer, generally through a field sales force that has undergone formal training.

The business sells to the customer directly through the direct channel. An example of a direct channel of distribution is a brewery that produces its own beer and sells it to clients at its own physical location. Customers receive the good or service straight from the seller.

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The correct question is:

You have developed a new product and have created a website where customers can go to order the product. Which type of channel are you most likely utilizing?

a

Direct channel

b

Indirect channel

c

Retail channel

d

Wholesale and retail channel

e

Business distributor

time remaining 14 minutes 28 seconds00:14:28 item 19 time remaining 14 minutes 28 seconds00:14:28 which market is most likely to be characterized by oligopolistic competition in the united states?

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The  markets is most  likely to be characterized by oligopolistic competition in the United States---- soft drinks.

What are the characteristics of oligopolies in economics?

Characteristics of oligopolies include high barriers to entry, pricing power, business interdependence, revenue maximization, product differentiation, and non-price competition.

What is the purpose of oligopolies?

An oligopolistic market is a market where profit-maximizing competitors establish their strategies by paying particular attention to their competitors' possible reactions. Under these conditions, companies can differentiate their products, which may benefit some consumers but at a cost.

What is an example of oligopolistic competition?

When one company sets a price, others respond in a way that keeps their customers buying. For example, if an airline reduces ticket prices, other players often follow.

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who would provide the final approval for decisions made for a bullying awareness program? a.) project team members b.) project manager c.) users d.) project sponsor

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The very last acclaim for selections made for a bullying attention software is  b.) task manager .

The required details for Project manager in given paragraph

A task manager is a expert within side the discipline of task control. Project managers have the duty of the planning, procurement and execution of a task, in any venture that has a described scope, described begin and a described finish; irrespective of industry. Project managers are first factor of touch for any problems or discrepancies bobbing up from within side the heads of numerous departments in an organization earlier than the trouble escalates to better authorities, as task representative.

Project control is the duty of a task manager. This man or woman seldom participates at once within side the sports that produce the result, however alternatively strives to hold the progress, mutual interplay and tasks of numerous events in any such manner that reduces the danger of ordinary failure, maximizes benefits, and minimizes costs.

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why does the fact that she might not like living in california make someone think renting a home is better than buying one?

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She does not want to pay property taxes to support a place she might not like living in. The value of owning renting versus renting is heavily influenced by market conditions. Owning makes more sense in fast increasing real estate markets.

Renting, on the other hand, may be a preferable alternative when there is less room for property price appreciation. The one disadvantage of renting is a restricted lifestyle (option d). market a house is living in someone else's home. The landlord owns it, and the two parties have a formal agreement in which the other party pays the owner rent at regular intervals.

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7 a company's chief executive officer (ceo) has decided to launch a corporate social responsibility (csr) program. who are the intended beneficiaries of a csr program?

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The company's chief executive officer (ceo) has decided to launch a corporate social responsibility (csr) program.Stakeholders are the intended beneficiaries of a csr program

Any individuals or groups that are influenced by a project, initiative, policy, or organization, whether favorably or unfavorably, are considered stakeholders. They could be external (individuals outside of your organization) or inside (people outside of your organisation). The abbreviation UPIG, which stands for Users, Providers, Influencers, and Governance, makes it simple to recall these four kinds of stakeholders. A stakeholder's primary duty is to contribute their expertise and point of view to a project in order to help the organization accomplish its strategic objectives. A project success depends on their support. All individuals or groups with a stake in the success of the company are considered stakeholders. Since an organization's level of authenticity is based on how well it satisfies its stakeholders' needs, it is crucial that organizations develop healthy and balanced relationships with them.

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the term community refers to a company's area of local business influence. group of answer choices true false

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The region of a business's influence on the local economy is referred to as its community.True.

What exactly is community economy?

Localized business activity is frequently referred to as a "community economy."We do not employ it in this manner.Our collective project challenges conventional definitions of "community" and "economy," resulting in a new way of understanding and engaging with work-and-life practices.

What effect does business have on the community?

To encourage more people to remain in the area, increasing the number of local businesses means creating more jobs.This not only lets people work closer to where they live, but it also improves the community's quality of life by making the community more self-sufficient, bringing people together, and raising city revenue.

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ayana enjoys cycling and is in the market for a new bicycle. she is fairly knowledgeable about bikes and knows most of the major brands, such as trek, cannondale, specialized, and giant, and will likely purchase one of these brands. these four brands are

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Ayana adores riding and is looking for a new bike. She is somewhat knowledgeable about bikes and is familiar with the majority of the big brands, including Trek, Cannondale, Specialized, and Giant, and will most likely purchase one of these brands. These four brands are being considered. As a result, the appropriate term is a consideration.

What does the term "consideration" mean?

A promise, performance, or forbearance bargained by a promisor in exchange for their promise is referred to as consideration. A contract's fundamental component is a consideration. A contract cannot be enforced unless it is considered by both parties.

The four forms of consideration are as follows.

Executed Consideration. Past ConsiderationConditional Consideration Unreal Consideration.

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The average price for a world series ticket in philadelphia has skyrocketed to more than?.

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World Series tickets in Philadelphia value over $3,000 each—the second-highest worth during a decade. Rhys Hoskins of the Philadelphia Phillies reacts once defeating the city Padres.

In game 5 to win the National League Championship Series at voters Bank Park on Oct twenty-three, 2022, in Philadelphia, Pennsylvania.

Demand for playoff tickets in Philadelphia has driven their value to a historic high. The average worth of game tickets at voters Bank Park is among the best in major Baseball history.

Consistent with the Delaware News Journal, tickets to Philadelphia Phillies home games in their playoff tilt with the Houston Astros have reached a median value of over $3,200, the second-highest total in baseball history.

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lauren is an administrative assistant at a big law firm. while her days are busy answering phones, preparing documents on the computer, and scheduling appointments, it is mostly sedentary work. lauren has poor eating habits and is overweight. because of a family history of heart disease, lauren's doctor suggested that she join a new weight loss support group at the hospital that teaches healthy lifestyle changes such as diet and exercise. this is an example of

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The example by Lauren is secondary prevention.

The goal of this prevention is to lessen the effects of illnesses that have already had an impact on a person.

This implies that one must move quickly to combat the sickness as soon as feasible in order to stop its progression and engage in activities that can help one return to their previous state of health. To prevent a serious impact in the future, this is done.

The person begins by getting regular checkups and screening tests in the early stages of being affected - adhering to a healthy diet Lauren has already started eating unhealthily and she is now overweight, which means she is already affected by various diseases or at risk of such diseases, so she is past the primary prevention which includes not engaging in any unhealthy activities from day one.

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a company that provides a free online language course wants to determine if learners would be willing to pay $12 per month for a premium version of the course. which questions might lead to question wording bias? check all that apply. do you think $12 is too much to pay for a premium version of the course? what amount would you expect to pay for a premium version of the course? would you pay $12 for a premium version of the course, given that learning a language has been shown to improve concentration skills and memory? would you pay $12 for a premium version of the course even though it is currently free? what is the most you would pay for a premium version of the course?

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The number of people willing to pay $12 per month for a premium version of the course.

The term "Premium Version" refers to the application's paid version, which includes the following features: time and expense tracking, web and mobile, expense note camera capture, project follow-up, project time overview, teamwork, pushing tasks and projects to collaborators, personal time analysis, team analysis, export options, electronic invoicing, interface, project & budget follow-up, project & client analysis, and premium support.

Is this the reason why spelling errors are now detected and corrected differently When we right-clicked on a typographical error in the past, as is done in the Community, the proper or alternate version was displayed. Right-/left-clicking to find the correct spelling no longer always works, and the entire incorrect word is now lightly highlighted..

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according to herzberg, what do managers try to achieve by providing hygiene factors at appropriate levels?

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Herzberg believes that proper management of hygiene factors can prevent employee dissatisfaction, but these factors cannot serve as a source of satisfaction or motivation. Good working conditions, for example, will keep employees working but will not make them work harder.

Customer Satisfaction Is Satisfying consumer needs is the desire of every company. Meeting consumer needs is not only an important factor for the company's survival, but also enhances its competitive advantage. Consumers who are satisfied with products and services are likely to repurchase and reuse services when the same need reappears in the future. This means that satisfaction is the main consumer repurchase factor that accounts for most of the company's sales volume.

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which of the following questions will prescriptive analytics help a company address? a. how many and what types of complaints did they resolve? b. what do they expect to pay for fuel over the next several months? c. what is the best way of shipping goods from their factories to minimize costs? d. what will happen if demand falls by 10% or if supplier prices go up 5%?

Answers

The prescriptive analytics help a company address in "what is the best way of shipping goods from their factories to minimize costs?"

The prescriptive analytic in the best way of shipping goods from their factories to minimize costs to analysis by the data analytics. In business analytics, it helps in the increase efficiency, improve decision-making, and better use resources.

Using prescriptive analytics to improve the way of shipping goods from their factories to minimize costs and analytics can make data-driven decision for increasing the profit.

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according to the proposed guidelines for the use of instruction, modeling, and physical guidance, what behavioral principle is used with all three procedures?

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Positive reinforcement, fading, and shaping are those behavioral principles used with all three procedures according to the proposed guidelines for the use of instruction, modeling, and physical guidance.

The idea behind positive reinforcement is that by reinforcing desired actions in pupils, they will be more likely to behave in accordance with our expectations. If a behavior is reinforced, it will probably continue over time. According to behaviorism, all behaviors are acquired through interactions with the environment. According to this learning theory, environmental variables such as upbringing have a far less important role in determining behavior than intrinsic or inherited traits.

Situational inducement is the process of changing behavior by utilizing circumstances and situations that have previously exerted power over it. Exercise keeps you physically and psychologically well; the more you exercise, the more benefits you receive. Regular physical activity for adults can lower the risk of, or assist in managing cardiovascular disease.

 

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which of the following would not cause a shift in the long-run aggregate-supply curve? a. an increase in the available labor b. an increase in the available capital c. an increase in the available technology d. an increase in price expectations e. all of the above shift the long-run aggregate-supply curve.

Answers

An increase in price expectations would not cause a shift in the long-run aggregate-supply curve.

What is supply curve?A supply curve is a graphical representation of the correlation between the price of a good or service and its supply over a period of time. In a typical plot, price is displayed on the left vertical axis and shipment quantity is displayed on the horizontal axis. Most of the time the supply curve is drawn as an increasing slope  from left to rightThis is because product price and supply are directly related (that is, when the price of a commodity rises in the market, supply increases). Changes in the price of goods or services cause changes in supply. A change in  supply shift causes a change in supply represented as a shift in the supply curve.

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fong medical equipment recently paid $1.10 as its annual dividend. future dividends are projected at $1.06, $1.02, and $1.00 over the next three years, respectively. after that, the dividend is expected to decrease by 2 percent annually. what is one share of this stock worth at a rate of return of 17 percent?

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Medical equipment can be used alone or in conjunction with any accessory, consumable, or other piece of medical equipment for the specific objectives of diagnosing and treating diseases, as well as for rehabilitation following illness or accident.

What is Medical equipment ?Examples include x-ray equipment, MRI and PET scanners, and ultrasound and CT scanners. Infusion pumps, medical lasers, and LASIK surgical equipment are all used during treatment. Equipment for life support is used to keep a patient's body functioning.Investing in stocks might be dangerous, but there are ways to lower your risk. For instance, research can assist you in making an informed choice about the potential performance of particular stocks. But remember that this is not a precise science. That's because a lot of unpredictable things, like emotions, market behavior, and world events, are at work.As a result, a company's stock may perform well or poorly. You'll need to calculate the gains and losses for your portfolio based on the result. In this post, we'll explain the fundamentals of computing gains and losses as well as some of the instruments at your disposal.

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ariffs on some products no longer serve their original purpose of protecting domestic producers but they are still levied by the government. what are these types of tariffs called?

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Tariffs implemented to protect a domestic industry are known as protective tariffs. They intend to make imported items more expensive than identical domestically produced goods.

Hence increasing sales of domestically made goods and boosting local business. A tariff might be particular, ad valorem, or compound (a combination of the two). A specific duty is a tax levied on a certain amount of money per unit of import, such as $1 per yard or pound. Ad valorem duties, on the other hand, are calculated as a percentage of the import's value. Tariffs harm consumers by raising the cost of imported goods.

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after a bank reconciliation is completed, journal entries are prepared for items in the balance per company's records as well as items in the balance per bank statement. true false

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The answer is true. A bank statement is a formal document that details your account activities over a specific time period, usually one month. You'll find records of all transactions, both entering and leaving, so you'll know exactly what happened to your money during that time period.

A bank statement, for example, would show a non-interest-bearing checking account with a beginning balance of $1,050, total deposits of $3,000, total withdrawals of $1,950, an ending balance of $2,100, and account zero service charges from September 1 to September 30. Each month, banks utilize the bank statements to document an account holder's transactions.

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what is the interest rate, i, per period? at the beginning of each quarter, a 50-year-old woman whose birthday is march 1st, deposits $1200 in a retirement account that pays 6% interest, compounded quarterly. how much is in the account when the woman turns 65 years old?

Answers

The amount in the account, when the woman turns 65 years old will be  $114,358.

Given in the Question:

The woman deposits $1200 every quarter, her first deposit will be made on her 50th birthday, April 1st.

As of March 1, the woman will be 65 years old, so we must determine how much money will be in her account.

Calculate interest for the quarter ending December 31 of the previous year by using the following steps:

So, there will be a total of (14 x4) +3 = 56 +3 = 59 quarter periods.

To determine the Final deposit amount, we will use the formula:

FV = [tex]P\frac{x(1+i)^{n}-1) }{i} (1 +i)[/tex]

Where,

P = $1200

i = 0.06/4 = 0.015

n = 59

Therefore, we will compute:

FV = [tex]1200\frac{(1+0.015)^{59}-1) }{0.015} (1 +0.015)[/tex] = $114,358.

Hence, the amount in the account when the woman turns 65 years old = $ 114,358.

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a university issues a bond with a face value of $5000 and a coupon rate of 4.41% that matures on july 15, 2018. the holder of such a bond receives coupon payments of $110.25. how frequently are coupon payments made in this case?

Answers

Every year, there would be two coupon payments that frequently are coupon payments made in this case

Coupon payment is what

Coupon payments refer to the monetary sum that bondholders would periodically receive from the university (the bond issuer) until the bond expires. It is expected that the coupons would be paid annually or semi-annually as indicated by this analysis.

The frequency of coupon payments is unknown since the coupon payment and coupon rate are tightly associated. As a result, we may utilize the coupon received, the par value, and the coupon rate to estimate the number of times in a year that coupons will be paid.

Coupon receipt is Par Value times Coupon Rate and Coupon Frequency.

$101.25 after coupons

Par value is $5,000.

coupons = 4.41%

uncertain coupon frequency (let's assume it's X)

$110.25=$5,000*4.41%/X

$110.25=$220.50/X

X=$220.50/$110.25

X=2

Coupons would be issued twice annually, resulting in semi-annual coupon payments.

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which evidence-based forecasting methods are useful in turning market research results into sales forecasts? select one: a. chain ration analysis, swag analysis, analogy b. swag ratio, analogy, judgment c. observation, survey, long interview d. analogy, chain ratio analysis, judgment

Answers

Chain ration analysis, swag analysis, analogy evidence-based forecasting methods are useful in turning market research results into sales forecasts. Using historical data as inputs, forecasting is a process that produces accurate predictions of the future course of trends.

Businesses use forecasting to decide how to spend their budgets and make plans for the upcoming expenses. The term "business forecasting" describes the instruments and research employed to foresee changes in the business world, such as sales, expenses, and profits. The Business forecasting seeks to improve strategy by making more accurate predictions. By using forecasting, your business may actively shape its future.

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the rate of return that financial investors require to hold a risky asset minus the rate of return on a safe asset is called the: multiple choice real interest rate. nominal interest rate. risk premium. discount rate.

Answers

The rate of return that financial investors require to hold a risky asset minus the rate of return on a safe asset is called the Option(c) risk premium.

What is risk premium?

Risk premiums are higher rates of return you can expect to earn from riskier assets such as stocks as opposed to government bonds.

Investing involves a risk, or chance, that your investment will underperform and lose money. There are many reasons why share prices might fall dramatically, such as mismanagement by the issuer, poor financial performance, or market conditions in general.

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antitrust laws in general are used to question 14 options: encourage oligopolists to pursue cooperative-interest at the expense of self-interest. prevent oligopolists from acting in ways that make markets less competitive. encourage frivolous lawsuits among competitive firms. encourage all firms to cut production levels and cut prices.

Answers

antitrust laws in general are used to Prevent oligopolists from acting in ways that make markets less competitive.

The antitrust legal guidelines proscribe illegal mergers and enterprise practices in standard phrases, leaving courts to decide which of them are illegal based totally on the data of every case. Courts have carried out antitrust legal guidelines to changing markets, from a time of horse and buggies to the prevailing virtual age.

It prohibits all agreements and conspiracies in restraint of alternate and commerce. those prohibited restraints consist of fee fixing, marketplace allocation, boycotts, bid rigging, and tying agreements. The Sherman Act additionally prohibits monopolizing or trying to monopolize any line of trade.

Antitrust legal guidelines shield opposition. unfastened and open opposition blessings, purchasers, by ensuring decreased expenses and new and better merchandise. In a freely aggressive market, every competing business commonly will try and entice purchasers with the aid of cutting its prices and growing the fine of its services or products.

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if a specific set of importing steps will be performed frequently, how can that process be made more efficient?

Answers

Data is entered into a table using the datasheet view.

Is there a database object that retrieves particular data from multiple database objects?

A database object known as a query is one that retrieves particular data from one or more database objects known as tables or other queries.You can enter, edit, or display data from a table or a query using an Access object called a form.

Is it used for each and every piece of data in every record?

a method. a single piece of information that is formatted as a column in a database table and is stored in each record. a list of the table's field names. A field's characteristics that regulate how the field displays and how data can be entered.

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if one of the production crew members in the management in action case is known for keeping the team headed in the right direction to meet taping deadlines, this person would have the role of .

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If a member of the production team in the management in action instance has a reputation for keeping the group moving forward to fulfill recording deadlines, this person would play the role of an orienter.

Orienter is one who helps a newcomer get used to social situations or local customs.

Orienter examines and explains the group's stance. summarizes what has been accomplished, identifies detours made by the group, and makes recommendations for how to turn things around.

The setup, breakdown, upkeep, and removal of musical and theatrical production equipment for stage work fall under the purview of the production crew. They are employed by touring bands, theater organizations, event venues, and production businesses.

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what are the two problems with having so much data available for data-driven decision making? (check all that apply)

Answers

The two issues with having so much data available for data-driven decision making are being data rich and being information poor.

In psychology, decision-making is defined as the cognitive process that results in the selection of a belief or plan of action from among multiple available alternatives. It could be sensible or irrational. The decision-making process is a reasoning process that is based on the decision-values, maker's preferences, and beliefs. Every decision-making process results in a final choice, which may or may not trigger action. Decision-making research is frequently published under the term problem solving, particularly in European psychology research.

Decision-making can be viewed as a problem-solving activity that results in a solution that is deemed ideal, or at least satisfactory. It is thus a process that might be more or less rational or irrational, and can be based on explicit or implicit knowledge and ideas.

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macroeconomic policies that focus on credit and interest rates or controlling the money supply are called

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Monetary policy is the macroeconomic policy that focus on credit and interest rates or controlling the money supply

What is Monetary policy ?In order to ensure price stability and public confidence in the value and stability of the country's currency, the monetary authority of a country adopts a policy known as monetary policy. This policy aims to control either the interest rate payable for very short-term borrowing or the money supply.By altering interest rates or eliminating surplus reserves, monetary policy can increase the amount of money in circulation or decrease it. Fiscal policy, in contrast, focuses on taxation, government spending, and borrowing as tools for a government to control economic cycle phenomena like recessions.The best monetary policy may be created with the help of monetary economics. Monetary policy and fiscal policy are typically developed independently in modern nations.It is said that monetary policy is either expansionary or contractionary.

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