Suppose the debt ratio (D/TA) is 50%, the interest rate on new debt is 8%, the current cost of equity is 16%, and the tax rate is 25%. An increase in the debt ratio to 60% would decrease the weighted average cost of capital (WACC).
Answer the following statement true (T) or false (F)
False
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Wedges in a pie chart are usually arranged clockwise in descending order or in another logical order, starting at 12 o'clock
Indicate whether the statement is true or false
Which of the following is not a principle of persuasion?
A. The belief in reciprocity is almost universal. B. People tend to resent and disrespect credible experts. C. People tend to like those who like them. D. People tend to do what they are personally committed to do. E. People tend to follow the lead of those most like themselves.
Which of the following is true of the accept-reject approach?
A) It involves ranking projects on the basis of some predetermined measure, such as the rate of return. B) It cannot be used when the firm has limited funds. C) It can be used for making capital budgeting decisions when there is capital rationing. D) It can be used only for evaluating mutually exclusive projects.
Use this information for questions that refer to the Yummy Ice Cream case.Kelly Stich, marketing manager for Yummy Ice Cream Products, is thinking about some of her products and her promotion plans for the coming year.Yummy Ice Cream Products is introducing a new ice cream treat called Planet Savers. This treat uses ice cream produced with environmentally friendly processes that save energy and protect the ozone. Yummy plans to send articles to magazines, local newspapers, and environmental groups that explain the environmentally safer treat. The product also has a unique texture and different flavor.Stich wants to use counter cards and in-store signs to let people know about Cherry Walrus, the company's new flavor. She is also developing sales training materials that will teach ice cream
scoopers in Yummy's ice cream stores to promote the product. Right after Cherry Walrus is introduced, each store will also hand out coupons that are good for one day only.Yummy Mondaes is a product that has been around for 25 years. It is Yummy's take on the classic ice cream sundae, but white-brownie and coffee-flavored crumbles are added to make it extra special. The company sells this product in one-quart and two-quart containers through major grocery store chains. It relies on personal selling and price discounts to retailers to move more of the product. The company does very little consumer promotion for this product.Yummy Fudge-on-a-Stick is a new product of fudge-flavored ice cream on a stick. Yummy plans to sell it through retail grocery stores and is launching an aggressive advertising program that will use television, radio, newspaper, magazines, and the Internet. Most of its promotion will be directed at consumers.Two years ago, the company introduced Yummy Fruit-on-a-Stick, an all-natural frozen fruit product on a stick. The product category has been popular, continues to grow, and is in the market growth stage of the product life cycle. According to your textbook, with a new product like Planet Savers, a marketing manager should A. attempt to obtain publicity. B. use an informing promotional objective. C. target initial communications toward innovators and early adopters. D. All these answers are correct.