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Critically discuss key assumptions attached to the breakeven model, within the light of the reality of today’s business environments.
A. Empress Express has no debt but can borrow at 8.2 percent. The WACC for the firm is currently at 11 percent, and the tax rate is 35 percent.
1. What is the cost of equity for the firm?
2. If the firm converts to 25 percent debt, determine the total cost of equity and the WACC for the firm.
B. The analysis of inventory policy is analogous to the analysis of credit policy.
C. Explain how efficient inventory management affects the risk, liquidity and profitability of the firm.
D. Discuss any three (3) sources of information that you might use to analyze a credit applicant.
Nkandu has a K10,000 to invest in a stock portfolio on LuSE. He intends to invest Page 3 of 3 in Stock X with an expected return of 14 percent and Stock Y with an expected return of 10.5 percent. If his goal is to create a portfolio that will generate a return of 12.4 percent, how much money should he invest in Stock X and Stock Y?
Z Ltd bond has a 10 percent coupon rate and a K1,000 face value. Interest is paid semiannually, and the bond has 20 years to maturity. If investors require a 12 percent yield, what is the value of the bond? Also, determine the effective annual yield on this bond?
Using a practical example, explain what is meant by an Effective Annual Interest Rate?
Match the leadership theories column A and B. In your own words substantiate your answer in column c
a)servant leadership 1 consider one’s and others feelings
b) peer-to-peer leadership 2 Best style for a given situation
c) Agile leadership. 3 concern for people and production
Empress Express has no debt but can borrow at 8.2 percent. The WACC for the
firm is currently at 11 percent, and the tax rate is 35 percent.
I.
What is the cost of equity for the firm?
II.
If the firm converts to 25 percent debt, determine the total cost of equity and
the WACC for the firm.
What do you think about Bob Van Djik Naspers earning a lot of money (1.9 billion)(not the soccer player)?
Draw a value chain of choice in accordance to risk managemwnt and insurance
Discuss the features of good governance and their relevance to the development agenda of any third world nation.
