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NEW QUESTION: 1 Jacobi Lefebre, CFA, recently accepted a position in the Real Estate Strategy group of a large retail company. The Director of the group walks by Lefebre's cubicle, hands him a report with the following information, and asks Lefebre to determine how large a project the firm can undertake without increasing the marginal cost of capital. The firm can undertake a project costing up to approximately: A. $81 million. B. $29 million. C. $83 million. D. $54 million. Answer: D Explanation: Explanation/Reference: Explanation: This question is asking you to calculate the retained earnings break even point BPRE(in relation to the marginal cost of capital). Once the breakeven point is reached, the firm will have to use external equity to fund projects, thus increasing the weighted average cost of capital (WACC). The break point on the marginal cost curve is given by: BPRE= (Retained Earnings) / (Equity Fraction, we) Here, RE = earnings * (1 - Payout) = $50 million * (1 - 0.35) = $ 32.5 million, And BPRE= $32.5 million / 0.60 = $54.17 million, or approximately $54 million.
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NEW QUESTION: 4 A wool sock, a toilet seat, Oriental silk -- out of a millennium of mud comes proof that the globe-traveling Vikings weren't the ravaging rovers historians made them to be. "The old English image of the Vikings as simply blood-thirsty bands of pillagers vanished with these finds," says Richard Hall, an archaeologist. "We dug down and found a cocoon of water-logging, a time capsule of everyday life," said Hall, who led a tour Wednesday through a muddy concrete hall fashioned out of the hole left from the excavation. Hall was one of some 400 people who, for five years, dug up the leftovers of the lives of an estimated 30,000 Vikings. Workers discovered the sophisticated settlement when a central district of York was leveled for rebuilding. Starting April 14, 1984, electric cars will carry tourists through a tunnel of time that goes back to 866 A.D., when the Vikings came to York, 188 miles northwest of London. Archaeologists are eager to display what they found in a $3.9 million reconstruction of Jorvik, the Anglo- Saxon name for the settlement. "We have skeletons, 15,000 objects, a quarter-of-a- million pieces of pottery, some of the best reserved Viking-age buildings ever discovered and five tons of animal bones," Hall said. The digs revealed intimate details of Viking life. There is a toilet seat, keys, tools, games counters, the seeds in the blackberries they picked and a knitted woolen sock. "They were a great trading nation with a sophisticated monetary system," Hall said. "We will show the range of products in which they traded -- silk from the Far East, amber from the Baltic, pottery from the Rhineland, cowrie shells from the Indian Ocean." About how long ago did the Vikings come to York? A. 1000 years ago B. 100 years ago C. 10,000 years ago D. 30,000 years ago Answer: A Explanation: Explanation/Reference: Explanation:
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