A Firm Requires an Investment of $30,000 and Borrows $7500

question 43

Multiple Choice

A firm requires an investment of $30,000 and borrows $7500 at 7%. If the return on equity is 18%, what is the firm's pretax WACC?

• A) 7.6%
• B) 18.3%
• C) 21.4%
• D) 15.3%

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Definitions:

Job Analysis

The process of getting detailed information about jobs.

Job Specification

A list of the knowledge, skills, abilities, and other characteristics (KSAOs) that an individual must have to perform a particular job.

Knowledge, Skills, Abilities

The set of competencies that are required for effective performance in a job or task, encompassing theoretical understanding, practical execution, and inherent capabilities.

Tasks, Duties, Responsibilities (TDRs)

Specific elements of a job, including the work one must accomplish, the obligations one must fulfill, and the areas for which one is accountable.