Suppose TouchTech, a hand-held computing firm, is selling bonds to raise money for a new laba practice known asfinance. Buying a bond issued by TouchTech would give Paolothe firm. In the event that TouchTech runs into financial difficultywill be paid first. Suppose instead Edison decides to buy 100 shares of TouchTech stock. Which of the following statements are correct?A. TouchTech earns revenue when Edison purchases 100 shares, even if he purchases them from an existing shareholder. B. Expectations of a recession that will reduce economy-wide corporate profits will likely cause the value of Edison's shares to decline. C. An increase in the perceived profitability of TouchTech will likely cause the value of Edison's shares to rise. D. Alternatively, Edison could invest by purchasing bonds issued by the government of Japan. E. Assuming that everything else is equal, a bond issued by a government that is engaged in a civil war most likely pays a (higher or lower) interest rate than a bond issued by the government of Japan.

Which of the following is an example of an unsought good? a. cameron purchases a new bike. b. jordan buys paper towels. c. taylor buys cupcakes from her favorite bakery. d. riley buys new windshield wipers for her car.

Calculate the cost of each capital component—in other words, the after-tax cost of debt, the cost of preferred stock (including flotation costs), and the cost of equity (ignoring flotation costs). use both the capm method and the dividend growth approach to find the cost of equity.calculate the cost of new stock using the dividend growth approach.what is the cost of new common stock based on the capm? (hint: find the difference between re and rs as determined by the dividend growth approach and then add that difference to the capm value for rs.)assuming that gao will not issue new equity and will continue to use the same target capital structure, what is the company’s wacc? e. suppose gao is evaluating three projects with the following characteristics.each project has a cost of $1 million. they will all be financed using the target mix of long-term debt, preferred stock, and common equity. the cost of the common equity for each project should be based on the beta estimated for the project. all equity will come from reinvested earnings.equity invested in project a would have a beta of 0.5 and an expected return of 9.0%.equity invested in project b would have a beta of 1.0 and an expected return of 10.0%.equity invested in project c would have a beta of 2.0 and an expected return of 11.0%.analyze the company’s situation, and explain why each project should be accepted or rejected g

Suppose that in an economy the structural unemployment rate is 2.2 percent, the natural unemployment rate is 5.3 percent, and the cyclical unemployment rate is 2 percent. the frictional unemployment rate is percent and the actual unemployment rate (in this economy) is percent.