The Corner Store factors all of its receivables immediately at a discount rate of 1.1 percent. The average collection period is 37.4 days and default is unlikely. What is the effective cost of borrowing?

Project A has cash flows of −$50,000, $49,400, $27,200, and $24,500 for Years 0 to 3, respectively. Project B has an initial cost of $50,000 and an annual cash inflow of $18,500 for four years. These are mutually exclusive projects. What is the crossover rate?

A stock had returns of 2 percent, −23 percent, and 13 percent over the past three years. What is the geometric average return for this time period?

One year ago, you purchased 100 shares of Bailey Homes stock at a price of $37.78 per share. The company pays a quarterly dividend of $1.85 per share. Today, you sold for the shares for $28.30 per share. What is your total percentage return on this investment?

Schubach Ranch Supply offers its credit customers a two percent discount if they pay within ten days. This discount is referred to as a ____ discount.

Rosa’s has a weighted average cost of capital of 11.73 percent. The cost of equity is 15.8 percent and the pretax cost of debt is 7.6 percent. The tax rate is 21 percent. What is the target debt-equity ratio?

Projects A and B are mutually exclusive. Project A has cash flows of −$10,000, $5,100, $3,400, and $4,500 for Years 0 to 3, respectively. Project B has cash flows of −$10,000, $4,500, $3,400, and $5,100 for Years 0 to 3, respectively. What is the crossover rate for these two projects?

Hall Service Corporation is considering a project that will require $39,000 in net working capital and $68,000 in fixed assets. The project is expected to produce annual sales of $78,500 with associated cash costs of $41,000. The project has a four-year life. The company uses straight-line depreciation to a zero book value over the life of the project. Ignore bonus depreciation. The tax rate is 25 percent. What is the operating cash flow for this project?

You’ve observed the following returns on Pryor Farm Produce stock over the past five years: 8 percent, −5 percent, 16 percent, 12 percent, and 8 percent. What is the variance of these returns?

At an output level of 22,500 units, you calculate that the degree of operating leverage is 1.37. What will be the percentage change in operating cash flow if the new output level is 25,000 units?