A Firm Has 12,500 Shares of Stock Outstanding That Sell

question 44

Multiple Choice

A firm has 12,500 shares of stock outstanding that sell for $42 each.The book value of equity is $400,000.The firm has also issued $250,000 face value of debt that is currently quoted at 101.2.What value should be used as the weight of equity when computing WACC?

• A) 67.48%
• B) 72.09%
• C) 61.54%
• D) 69.74%

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Definitions:

Interpersonal Skills

The abilities and traits a person uses to interact effectively with others, including communication, empathy, and conflict resolution skills.

Critical Thinking Skills

The ability to actively and skillfully conceptualize, apply, analyze, synthesize, and evaluate information to make informed judgments and solve problems.

Positive Attitude

A mental outlook of optimism and of expecting good outcomes, which can influence one's resilience and approach to challenges.

Time Management

An assortment of skills, tools, and practices used to manage time during daily activities and when accomplishing specific projects.