Red Earth Company has two divisions, the Okla Division and the Homa Division. Last year, the Okla Division earned $66,000 using average operating assets of $550,000. Last year, the Homa Division earned $260,000 using average operating assets of $2,000,000. Minimum required rate of return for Red Earth is 9%.
Now assume that the minimum required rate of return for Red Earth is 12%.
Definitions:
Body Pleasure
The positive sensations and experiences associated with physical stimulation or activities that promote well-being.
Aversion Therapy
A form of psychological treatment in which undesirable behaviors are paired with uncomfortable or unpleasant stimuli to reduce their occurrence.
Sensate Focus
A therapeutic technique used in sex therapy involving a series of exercises designed to build intimacy and reduce performance anxiety by focusing on touch and sensation.
Nondemand Pleasuring
A therapy technique encouraging partners in a sexual relationship to explore physical intimacy and pleasure without the pressure of specific performance outcomes.
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