Describe Net income approach
Briefly describe Net income approach? Named who recommended this theory?
Expert
Net income (or NI) approach as this is as well termed as traditional approach. This is an approach in that both, equity and cost of debt are independent of capital structure. The constituents that are involved in it are steady and don’t depend on how much debt the firm is using. This theory was recommended by David Durand. In this alter in financial leverage leads to alter in entire cost of capital as well as whole value of firm. If financial leverage rises, weighted average cost reduces and value of firm and market price of equity raises. If this reduces then weighted average cost of capital raises and value of firm and market price of equity reduces. The suppositions that can be made according to this approach is that there are no taxes involved in this and the employ of debt does not alter the risk factor for the investors and will continue the same throughout.
While productive resources are utilized efficiently: (w) prices greatly exceed production costs for current outputs. (x) opportunity costs are at their minimums for all goods. (y) domestic production exceeds the value of foreign output. (z) the value
Elucidate an example of simultaneous changes in both supply and demand?
Perfect competition is characterized by all of the following except w) heavy advertising by individual sellers. x) homogeneous products. y) sellers are price takers. z) a horizontal demand curve for individual sellers. Q : Distinguish clearly between a plant Distinguish clearly between a plant, a firm, and an industry?
Distinguish clearly between a plant, a firm, and an industry?
Briefly describe High operating leverage?
Evaluate and explain the statements: “The market system is a profit-and-loss economy”
Describe unanticipated inflation?
Question Discuss the impact of dollar depreciation on the various aspects of American Economy. Devaluation of the DollarIntroduction:
What is the most important source of revenue and the major type of expenditure at the local level?
Illustrate a summary of what can cause an increase in demand?
18,76,764
1941465 Asked
3,689
Active Tutors
1447258
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!