According to data presented by the author, corporate tax rates in the United States are among the lowest across major economies. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
For firms that are able to raise funds through the sale of commercial paper, it is generally cheaper than borrowing from a commercial bank. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
According to Modigliani and Miller (M&M), in a world of perfect capital markets, except that interest on debt is tax deductible, what will be the expected equity return (or cost of equity) for a firm that has a cost of capital of 14 percent, a cost of debt of 8 percent, a tax rate of […]
Date: September 19th, 2020
Global Logistics purchased a new machine on October 20th, 2014 for $1,000,000 on credit. The supplier has offered A&A terms of 2/10, net 45. The current interest rate the bank is offering is 16 percent. (a) Compute the cost of giving up cash discount. (b) Should the firm take or give up the cash discount? […]
Date: September 19th, 2020
The firm’s demand risk can best be analyzed by examining: A) the components of the firm’s marketing plan. B) the components of the firm’s marketing management compared with the key industry success factors. C) the key industry success factors and their impact on profitability. D) the behavior of the firm’s major competitors. ANSWER […]
Date: September 19th, 2020
Operating leverage results from the existence of operating costs in a firm’s income stream. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
In the short-run, firms tend to stick to a stable dollar-dividend policy. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Commercial paper is a form of financing that consists of short-term, secured promissory notes issued by firms with a high credit standing. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Value proposition refers to: A) a statement that describes the benefits of the firm’s products and services. B) a statement that describes the unique features of the firm’s products and services. C) a statement that describes why a specific target customer should choose the firm’s products or use its services. D) None of the above. […]
Date: September 19th, 2020
Tangshan Mining borrowed $100,000 for one year under a revolving credit agreement that authorized and guaranteed the firm access to $200,000. The revolving credit agreement had a stated interest rate of 7.5 percent and charged the firm a 1 percent commitment fee on the unused portion of the agreement. Based on this information, the effective […]
Date: September 19th, 2020
