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NEW QUESTION: 1
The WACC of a firm equals 10.67%. The pre-tax cost of debt equals 8.4%, the firm pays 38% taxes and the firm's equity holders expect a rate of return of 17%. The firm's debt-to-equity ratio equals ________.
A. 1.16
B. 0.86
C. 1.41
D. 0.72
Answer: A
Explanation:
Explanation/Reference:
Explanation:
Let E/(D+E)
A. Then,
WACC = (1-A)*(1-t)*RD + A*RE, where t is the tax rate. Therefore,
10.67% = (1-A)*(1-38%)*8.4% + A*17%. Hence, A = E/(D+E) = 0.463 and (D+E)/E = 1/0.463 = 2.16.
This gives D/E = 1.16.

NEW QUESTION: 2

A. Option C
B. Option B
C. Option D
D. Option A
Answer: A

NEW QUESTION: 3
Which statements are true regarding a prebuilt Salesforce computer telephony integration (CTI) adapter for
different telephony systems? (Choose 2)
A. It utilizes the SoftPhone capability from within the Salesforce application
B. It is an intermediary between a telephony system and a Salesforce CRM call center user
C. It allows voicemails to be captured and stored as attachments on cases
D. It is a server based software program that controls the behavior of a Salesforce SoftPhone
Answer: A,B