Exhibit 9.1 The Collins Group, a Leading Producer of Custom Automobile Accessories

question 10

Multiple Choice

Exhibit 9.1
The Collins Group, a leading producer of custom automobile accessories, has hired you to estimate the firm's weighted average cost of capital.The balance sheet and some other information are provided below.

The stock is currently selling for $15.25 per share, and its noncallable $1, 000 par value, 20-year, 7.25% bonds with semiannual payments are selling for $875.00.The beta is 1.25, the yield on a 6-month Treasury bill is 3.50%, and the yield on a 20-year Treasury bond is 5.50%.The required return on the stock market is 11.50%, but the market has had an average annual return of 14.50% during the past 5 years.The firm's tax rate is 40%.
-Refer to Exhibit 9.1.What is the best estimate of the after-tax cost of debt?

• A) 4.64%
• B) 4.88%
• C) 5.14%
• D) 5.40%
• E) 5.67%

Identify and explain the use of Horney's secondary defenses in behavior.

Apply Kelly's individuality corollary to understand differences in perceptions in relationships.

Determine the causes of neurotic behavior according to Horney's theory.

Evaluate self-image accuracy using Horney's theory on idealized versus real self.

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Definitions:

Externalities

Unintended financial outcomes affecting individuals not directly engaged, potentially leading to good or bad impacts.

External Costs

Costs that are not borne by the producer or consumer of a good or service, but by society or the environment.

MSC (Marginal Social Cost)

The total cost to society of producing an additional unit of a good or service, including both the private costs and any external costs.

Efficient Level

Refers to the point at which a system, process, or economy operates at maximum productivity with minimal waste and expense.