Southeastern airlines's daily flight from atlanta to charlotte uses a boeing 737, with all-coach seating for 120 people. in the past, the airline has priced every seat at $138 for the one-way flight. an average of 78 passengers are on each flight. the variable cost of a filled seat is $26. aysajan eziz, the new operations manager, has decided to try a yield revenue approach, with seats priced at $81 for early bookings and at $193 for bookings within 1 week of the flight. he estimates that the airline will sell 67 seats at the lower price and 37 at the higher price. variable cost will not change.

Lambert manufacturing has $100,000 to invest in either project a or project b. the following data are available on these projects (ignore income taxes.): project a project b cost of equipment needed now $100,000 $60,000 working capital investment needed now - $40,000 annual cash operating inflows $40,000 $35,000 salvage value of equipment in 6 years $10,000 - both projects will have a useful life of 6 years and the total cost approach to net present value analysis. at the end of 6 years, the working capital investment will be released for use elsewhere. lambert's required rate of return is 14%. the net present value of project b is:

In the fall of 2008, aig, the largest insurance company in the world at the time, was at risk of defaulting due to the severity of the global financial crisis. as a result, the u.s. government stepped in to support aig with large capital injections and an ownership stake. how would this affect, if at all, the yield and risk premium on aig corporate debt?

Take it all away has a cost of equity of 11.11 percent, a pretax cost of debt of 5.36 percent, and a tax rate of 40 percent. the company's capital structure consists of 67 percent debt on a book value basis, but debt is 33 percent of the company's value on a market value basis. what is the company's wacc