Question 71

A manufacturing company's long-term capital structure is 30% debt and 70% equity, its cost of equity is 10%, its average cost of debt is 8%, and the marginal tax rate is 34%. If the company has invested total capital of $567,865 in its production unit and the unit's operating profit is $79,856, what is the economic value added (EVA) of the unit?
  • Question 72

    Company ABC has a concentrated investor base consisting primarily of large institutional shareholders. It would like to increase its number of smaller shareholders using the most cost effective method of raising capital available. What should Company ABC do to accomplish this goal?
  • Question 73

    Which of the following is considered an important factor when selecting a financial service provider?
  • Question 74

    A trader of ABC Bank executed and audited his own trades. Assigning these two functions to the same person introduced which one of the following risks to the bank?
  • Question 75

    This question is based on the following data describing a company's actual deposits.

    If a five-day moving average is used, what was the deposit forecast for day six?