Profitability is the ability of the firm to generate earnings

Indicate whether the statement is true or false


T

Business

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An increase in the use of technology has caused

a. a decline in the amount of fixed costs in an organization. b. fewer costs to be susceptible to short-run control. c. companies to be more flexible in responding to short-term conditions. d. managers to be less concerned about capacity utilization because of the increased ability to produce in large quantities.

Business

Describe the “Hard HRM” and the “soft HRM”.

What will be an ideal response?

Business

Which of the following is a status quo-oriented pricing objective?

A. target return B. growth in market share C. nonprice competition D. unit sales growth E. profit maximization

Business

Slurp Cola Inc is all equity financed and generates perpetual annual EBIT of $600. Assume that the EBIT, and all other cash flows, occur at year end and that we are currently at the beginning of a year

Assume that Slurp has a 100% payout rate, 1,000 shares outstanding, and that shareholders require a return of 6%. Assume that the tax rate is 0%. Slurp Cola Inc is considering an open market stock repurchase. It plans to buy 20% of its outstanding shares at the price of $10.00 per share. The repurchased shares will be cancelled. It will finance the repurchase by issuing perpetual bonds with a coupon rate (and yield) of 4%. Assume that the tax rate is 0%. If Slurp goes ahead with the repurchase, then what is the stock price after the repurchase is complete? A) $9.50 B) $10.00 C) $10.50 D) $11.00 E) $11.50

Business