Is AJC's Current Total Market Value and Weighted Average Cost

question 52

Multiple Choice

is AJC's current total market value and weighted average cost of capital?

• A)$600,000; 7.5%
• B)$600,000; 8.0%
• C)$800,000; 7.0%
• D)$800,000; 7.5%
• E)$800,000; 8.0%

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Definitions:

Sunk Costs

Costs that have already been incurred and cannot be recovered, which should not affect future business decisions.

Mixed Cost

A cost that contains both variable and fixed cost components, changing in total with volume but remaining constant per unit.

Variable Cost

Costs that change in proportion to the good or service that a business produces, such as raw materials and direct labor expenses.

Fixed Cost

Expenses that do not change with the level of production or sales over a certain period, such as rent or salaries.