A franchisor makes money when the franchisee stays in business, needs lots of inputs, and pays continuing royalties.
Answer the following statement true (T) or false (F)
True
A franchisor makes money when the franchisee stays in business, needs lots of inputs, and pays continuing royalties. On the other hand, a franchisee is successful if the franchisor puts a program in place for all of the franchisees to be successful.
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The terms and conditions of a bond are set forth in its:
A. articles. B. underwriting agreement. C. indenture. D. restrictive covenants. E. call provision.
Cyborg Mechatronics is entirely equity financed with 400 shares outstanding and a market capitalization of $18,750 (P=$46.875)
Current financial data for Cyborg is provided in the table below for two states of nature, which correspond with two levels of sales. The standard deviation of EPS is $1.875. The CFO of Cyborg, John Conner, is considering a change in capital structure. In particular, he is thinking about borrowing $6,562.50. He will borrow the money by issuing perpetual bonds with a face value of $6,562.50 and a coupon rate of 6%. The borrowed money will be used to repurchase shares at $46.875 per share. Repurchased shares will be cancelled. Taxes are 0%. First, calculate the EPS in each state of nature if Cyborg borrows the money. Second, calculate the standard deviation of the EPS. What is the ratio of the standard deviation of EPS with the leveraged capital structure to the standard deviation under the current, all equity capital structure? Cyborg Mechatronics Bad Good EBIT $750 $2,250 Interest 0 0 Pre-Tax Income 750 2,250 Taxes (0%) 0 0 Net Income 750 2,250 # Shares 400 400 EPS $1.88 $5.63 A) 0.54 B) 1.25 C) 1.54 D) 1.88 E) 2.89
What is the name given to the process of evaluating risks and minimizing the costs associated with those risks?
A. Financial management B. Risk management C. Management planning D. Loss prevention
Fewer than a dozen countries follow Islamic law in some way
Indicate whether the statement is true or false