Firms U and L Each Have the Same Amount of Assets

question 2

Multiple Choice

Firms U and L each have the same amount of assets, and both have a basic earning power ratio of 20%. Firm U is unleveraged, i.e., it is 100% equity financed, while Firm L is financed with 50% debt and 50% equity. Firm L's debt has a before-tax cost of 8%. Both firms have positive net income. Which of the following statements is CORRECT?

• A) The two companies have the same times interest earned (TIE) ratio.
• B) Firm L has a lower ROA than Firm U.
• C) Firm L has a lower ROE than Firm U.
• D) Firm L has the higher times interest earned (TIE) ratio.
• E) Firm L has a higher EBIT than Firm U.

Explain the basic mechanisms of neural communication and the impact of neurotransmitters on behavior and disease.

Differentiate between the roles of the right and left cerebral hemispheres in processing various types of information.

Understand the physiological basis of memory and learning.

Describe the effects of aging on the nervous system and memory.

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Definitions:

Dendrite

The branched projections of a neuron that act to conduct the electrochemical stimulation received from other neural cells to the cell body, or soma.

Neuron

A nerve cell that is the basic building block of the nervous system, responsible for transmitting information throughout the body.

Terminal Buttons

The small knoblike structures at the end of an axon that release neurotransmitters to send signals to other neurons.

Neurotransmitters

Chemical substances in the nervous system that transmit signals across a synapse from one neuron to another, influencing both mental and physical functions.