This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Optimal capital structure, or debt capacity, is the debt-equity mix that minimizes the cost of the ... (Read 275 times)

s.tung

  • Hero Member
  • *****
  • Posts: 577
on: Jul 11, 2018
Optimal capital structure, or debt capacity, is the debt-equity mix that minimizes the cost of the firm's debt.
 
  Indicate whether the statement is true or false

Question 2

Given the anticipated rate of inflation (i) of 1.7 and the real rate of interest (R) of 1.4, find the nominal rate of
  interest (r).
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

poopface

  • Sr. Member
  • ****
  • Posts: 339
Reply #1 on: Jul 11, 2018
Answer to Question 1

FALSE

Answer to Question 2

r = R + i + Ri
r = .014 + .017 + (.014 )(.017 )
r = .031 + .000238 = .031238
r = 3.12


s.tung

  • Member
  • Posts: 577
Reply 2 on: Jul 11, 2018
Thanks for the timely response, appreciate it

carlsona147

  • Member
  • Posts: 341
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

Malaria was not eliminated in the United States until 1951. The term eliminated means that no new cases arise in a country for 3 years.

Did you know?

Patients who have been on total parenteral nutrition for more than a few days may need to have foods gradually reintroduced to give the digestive tract time to start working again.

Did you know?

GI conditions that will keep you out of the U.S. armed services include ulcers, varices, fistulas, esophagitis, gastritis, congenital abnormalities, inflammatory bowel disease, enteritis, colitis, proctitis, duodenal diverticula, malabsorption syndromes, hepatitis, cirrhosis, cysts, abscesses, pancreatitis, polyps, certain hemorrhoids, splenomegaly, hernias, recent abdominal surgery, GI bypass or stomach stapling, and artificial GI openings.

Did you know?

It is believed that humans initially contracted crabs from gorillas about 3 million years ago from either sleeping in gorilla nests or eating the apes.

Did you know?

Vaccines cause herd immunity. If the majority of people in a community have been vaccinated against a disease, an unvaccinated person is less likely to get the disease since others are less likely to become sick from it and spread the disease.

Lymph node structure. Lymph node structure.
Structure of tryptophan synthase Structure of tryptophan synthase
Structure of a complex of a type II DNA methylase with DNA Structure of a complex of a type II DNA methylase with DNA
Cost Accounting: A Managerial Emphasis 16th Edition Cost Accounting: A Managerial Emphasis 16th Edition
plant structure plant structure
Video: Michaelis–Menten equation & Kinetic parameters

For a complete list of videos, visit our video library