Pecking order theory states that firms will prefer to use internal financing first because selling securities to raise cash can be ___________ and firms would want to issue equity when the company is __________ valued in the market.

Skolits Corporation has a cost of equity of 10.9 percent and an aftertax cost of debt of 4.71 percent. The company’s balance sheet lists long-term debt of $385,000 and equity of $645,000. The company’s bonds sell for 105.9 percent of par and market-to-book ratio is 3.07 times. If the company’s tax rate is 40 percent, what is the WACC?

Rappaport Industries has 6,500 perpetual bonds outstanding selling for $2,000 each. The tax rate is 34 percent. What is the present value of the interest tax shield?

Lemon Corp. is debt-free and has a weighted average cost of capital of 12.7 percent. The current market value of the equity is $2.3 million and there are no taxes. According to M&M Proposition I, what will be the value of the company if it changes to a debt-equity ratio of .85?

Basis Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 180,000 shares of stock outstanding. Under Plan II, there would be 130,000 shares of stock outstanding and $2.27 million in debt outstanding. The interest rate on the debt is 8 percent and there are no taxes. c) What is the value of the firm under the levered plan?

Basis Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 180,000 shares of stock outstanding. Under Plan II, there would be 130,000 shares of stock outstanding and $2.27 million in debt outstanding. The interest rate on the debt is 8 percent and there are no taxes. b) What is the value of the firm under the all-equity plan?

Hotel Cortez is an all-equity firm that has 11,200 shares of stock outstanding at a market price of $35 per share. The firm’s management has decided to issue $68,000 worth of debt and use the funds to repurchase shares of the outstanding stock. The interest rate on the debt will be 9 percent. What is the break-even EBIT?

Filter Corporation has a project available with the following cash flows:YearCash Flow0−$13,50016,30027,60034,70044,300 What is the project’s IRR?

What is the primary source of conflict that is found in most organizations? 

Which style of conflict resolution is the opposite of competing?