Klose Outfitters Inc. believes that its optimal capital structure consists of 60 percent common equity and 40 percent debt, and its tax rate is 40 percent. Klose must raise additional capital to fund its upcoming expansion. The firm will have $2 million of new retained earnings with a cost of rs = 12%. New common stock in an amount up to $6 million would have a cost of re = 15%. Furthermore, klose can raise up to $3 million of debt at an interest rate of rd = 10% and an additional $4 million of debt at rd = 12%. The cfo estimates that a proposed expansion would require an investment of $5.9 million. What is the WACC for the last dollar raised to complete the expansion?

Aplant manager is considering buying additional stamping machines to accommodate increasing demand. the alternatives are to buy 1 machine, 2 machines, or 3 machines. the profits realized under each alternative are a function of whether their bid for a recent defense contract is accepted or not. the payoff table below illustrates the profits realized (in $000's) based on the different scenarios faced by the manager. alternative bid accepted bid rejected buy 1 machine $10 $5 buy 2 machines $30 $4 buy 3 machines $40 $2 refer to the information above. assume that based on historical bids with the defense contractor, the plant manager believes that there is a 65% chance that the bid will be accepted and a 35% chance that the bid will be rejected. what is the expected value under perfect information (evpi)?