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Author Question: Which of the following will increase (V0), the shareholder wealth maximization model of the firm: ... (Read 94 times)

oliviahorn72

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on: Jul 1, 2018
Which of the following will increase (V0), the shareholder wealth maximization model of the firm: V0(shares outstanding) = t=1 ( t ) / (1+ke)t + Real Option Value.
 a. Decrease the required rate of return (ke).
  b. Decrease the stream of profits (t).
  c. Decrease the number of periods from  to 10 periods.
  d. Decrease the real option value.
  e. All of the above.

Question 2

Assume Coke and Pepsi are substitutes. Holding other things constant, if the price of Coke increases
 a. Demand for Pepsi falls
  b. Demand for Pepsi increases
  c. Quantity demanded for Pepsi falls
  d. Quantity demanded for Pepsi increases


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ebonylittles

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Reply #1 on: Jul 1, 2018
Answer to Question 1

a

Answer to Question 2

b


oliviahorn72

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Reply 2 on: Jul 1, 2018
Excellent

strudel15

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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