If the % of uncollectible accounts receivable does not change, there can still be an increase in the loss for this concept simply because of an increase in sales. True or false?
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10.-
If the % of uncollectible
True or false?
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- If we hold all other factors the same, an increase in interest rates will: a. Decrease the present value of a stream of constant payments we expect to receive. b. Increase the present value of a stream of constant payments we expect to receive. c. Decrease the interest revenue that a company will earn on its funds that it holds in its interest-bearing checking account. d. No impact on how much a company should be willing to pay for factory equipment that is expected to significantly reduce the factory electricity costs.If banks suddenly start to pay interest on all demand deposits, their interest rate margin would: a) become larger b) become smaller c) be unaffectedIs the following sentence true or false? Please explain. The cost of new equity (re) could possibly be lower than the cost of reinvested earnings (rs) if the market risk premium, risk-free rate, and the company's beta all decline by a sufficiently large amount.
- An increase in interest rates would mostly harm the ___. 1. creditors 2. debtors 3. lenders 4. providers of fundsInflation O a. Results from too little money being issued. O b. Requires that people hold less money tolmake transactions. O c. Is the rate at which prices rise over time. O d. Is an increase of money in circulation.Question If the % of uncollectible accounts does not change, there cannot be a savings for this concept simply because of a decrease in sales. true or false?
- Question Select three answers for changes in credit standards that are causes of changes in profits: A) Decrease in sales volume. B) Applying an aging analysis of balances C) Increase in contribution margin D) Increase in financial expenses due to an increase in the interest rate. E) Granting of discounts to incentivize prompt payment F) Increase in the investment in accounts receivable.A decrease in the costs of using an ATM causes money demand to increase. Shifting the Money demand curve to the right.Group of answer choices A. The first statement is false. The second statement is true. B. The first and second statements are both false. C. The first statement is true. The second statement is false. D. The first and second statements are both true.Suppose a company’s current credit terms are 1/10,net 30, but management is considering changingits terms to 2/10, net 40, relaxing its credit standards, and putting less pressure on slow-payingcustomers. How would you expect these changesto affect (a) sales, (b) the percentage of customerswho take discounts, (c) the percentage of customers who pay late, and (d) the percentage of customers who end up as bad debts?
- Why have banks been losing income advantages ontheir assets in recent years?Which of the following is the most correct? A. In reference to the time value of money, the present value is always labeled as t=1 B. Negative MVAs indicate that a company's executives are managing the expenses well C. Nominal rates, or annual percentage rates, always equal the effective annual rate D. A strong ROE always indicates a strong year for a company E. Firms should generally try to minimize their days' sales outstanding in order to access their receivables at fast rates.Why does the WACC decrease as a company begins to take on debt and then increase after a certain point?
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