Question 11
A firm plans to raise $ 4 million by borrowing at an interest rate of 16 % and to raise $ 1
million by issuing common stock. The firm ' s stock has a beta coefficient of 2, the risk free
interest rate is 6 %, the average rate of return on stocks is 9 %, and the marginal tax rate is
25 %. What is the firm ' s composite cost of capital? Question 12
A firm that uses profits earned in one market to sell a product or service below its average
variable cost in another market is engaged in Question 13 In game theory, a dominant strategy refers to a choice Question 14
Which of the following is a device that controls imports and generates government
revenue? Question 15
There are two U. S. locations where your company is currently the only producer of soda.
You currently make 40 in each location, but Pepsi is entering the markets. What decision
should you make?( the chart applies to each location)