Answer to Question #186633 in Economics for Rafay

Question

(1) Pak Wheels wants to buy $500,000 worth of merchandise inventory from you, with

payment due in 90 days. (ii) Pak Wheels wants you, a large insurance company, to pay off its note at the bank and assume it on a 10-year maturity basis at a current rate of 14 percent. (i) There are 100,000 shares outstanding, and the stock is selling for $80 a share. The company offers you 50,000 additional shares at this price

Answer 1

Pak Wheels wants to buy $ 500,000 worth of inventory from you with payment within 90 days. - Increase in operating profit.

  Pak Wheels wants you, a major insurance company, to redeem its promissory note at the bank and accept it for a 10-year maturity at the current rate of 14 percent. - Changes in the financial capital of the company.

There are 100,000 shares outstanding and the share is being traded at $ 80 per share. The company is offering you 50,000 additional shares at this price. - Change in the authorized capital.