Phil's Carvings Wants to Have a Weighted Average Cost of Capital

question 25

Multiple Choice

Phil's Carvings wants to have a weighted average cost of capital of 9.5 percent.The firm has an aftertax cost of debt of 6.5 percent and a cost of equity of 12.75 percent.What debt-equity ratio is needed for the firm to achieve its targeted weighted average cost of capital?

• A).84
• B).92
• C)1.08
• D).76
• E).67

Calculate total variable cost and total cost from given data.

Understand the relationship between market demand and equilibrium price in purely competitive markets.

Understand how fixed, variable, and total costs affect a firm’s pricing and production decisions.

Examine the impact of economic profits on a firm’s production decisions.

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Definitions:

Empty Plate

Often symbolizes hunger or poverty, but in the context of discussions, it can represent opportunities or starting from scratch.

Visual Dominance Behaviour

A nonverbal communication pattern where individuals use eye contact or gaze to assert dominance or control in social interactions.

Lower-Status Listener

A listener perceived to have a lower hierarchical position or less power in a given social or professional context, affecting communication dynamics.

Disbursement

Any payment of funds made by the physician’s office for goods and services.