You are trying to decide whether to buy stock in company x or company y. both companies need $1,000 capital investment and will earn $200 in good years (with probability 0.5) and $60 in bad years. the only difference between the companies is that company x is planning to raise all of the $1,000 needed by issuing equity while company y plans to finance $500 through equity and $500 through bonds on which 10 percent interest must be paid. construct a table showing the expected value and standard deviation of the equity return for each of the companies.

Special order carson manufacturing, inc., sells a single product for $36 per unit. at an operating level of 8,000 units, variable costs are $18 per unit and fixed costs $10 per unit. carson has been offered a price of $20 per unit on a special order of 2,000 units by big mart discount stores, which would use its own brand name on the item. if carson accepts the order, material cost will be $3 less per unit than for regular production. however, special stamping equipment costing $4,000 would be needed to process the order; the equipment would then be discarded. assuming that volume remains within the relevant range, prepare an analysis of differential revenue and costs to determine whether carson should accept the special order. use a negative sign with answer to only indicate an income loss from special order; otherwise do not use negative signs with your answers.