UNLEV Has an Expected Perpetual EBIT = $4,000

question 154

Multiple Choice

UNLEV has an expected perpetual EBIT = $4,000. The unlevered cost of capital = 15% and there are 20,000 shares of stock outstanding. The firm is considering issuing $8,800 in new par bonds to
Add financial leverage to the firm. The proceeds of the debt issue will be used to repurchase equity.
The cost of debt = 10% and the tax rate = 34%. There are no flotation costs.
Assume a stockholder owns 1,000 shares of UNLEV before the restructuring. The stockholder
Prefers a debt/equity ratio = 1.0. How could the stockholder use homemade leverage to achieve the
Restructuring without the help of UNLEV? Assume there are no taxes.

• A) The stockholder should borrow $1,330 and buy 1,000 more shares of UNLEV.
• B) The stockholder should borrow $2,660 and buy 1,000 more shares of UNLEV.
• C) The stockholder should borrow $1,330 and buy 2,000 more shares of UNLEV.
• D) The stockholder should lend $667 and sell 300 shares of UNLEV.
• E) The stockholder should lend $1,337 and sell 667 shares of UNLEV.

Comprehend the role of specific glands in the endocrine system and their hormones.

Identify parts of the brain responsible for processing and coordinating sensory information.

Recognize the role of the limbic system in emotional behavior and learning.

Understand the basic research methods used in psychology, including experimental and non-experimental designs.

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Definitions:

High Neuroticism

A personality trait marked by emotional instability, anxiety, moodiness, irritability, and sadness.

High Agreeableness

High Agreeableness is a personality trait that involves a proclivity towards cooperation, trust, and empathy towards others, often leading to harmonious social interactions.

Big Five Traits

A model in psychology that describes personality using five broad factors: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

High Job Performance

The degree to which an employee excels in fulfilling their job responsibilities and tasks to a high standard.