CrochetCo is considering an investment in a project which would require an initial outlay of
$350,000 and produce expected cash flows in years 1-5 of $95,450 per year.
You have determined
that the current after-tax cost of the firm's capital (required rate of return) for each source of
financing is as follows:
Cost of Long-Term Debt 7%
Cost of Preferred Stock 11%
Cost of CommonStock 15%
Long-term debt currently makes up 25% of the capital structure, preferred stock 15%, and common
stock 60%. What is the net present value of this project?
A) $11,568 B) $2,149 C) -$9,306 D) $5,983
C
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Departmental direct operating margin also shows a department's contribution to the company's overall operating income
a. True b. False Indicate whether the statement is true or false
Which of the following is a way managers can enhance team cohesiveness?
A. Isolating the group from the actions of competitors or other threats. B. Providing team members precise instructions for their tasks. C. Creating a relatively large team. D. Assigning members randomly to teams. E. Emphasizing members' common characteristics.
Which of the following statements is true about maximize net marketing contribution strategy?
A) It is an offensive core strategy. B) It results in inefficient use of marketing resources. C) It requires careful margin management. D) Its first step is to focus on optimal management of price-volume rather than margin-volume. E) It is most effective in very unattractive markets where the firm has a very weak competitive position.
Sampling is less effective than coupons, advertising, and games or contests in helping consumers evaluate products
Indicate whether the statement is true or false