math
posted by Emi .
Smith and Jones has two separate divisions. Division X produces custom work on a prepaid basis only for longterm customers and therefore, is subject to less risk than division Y. The company has assigned a discount rate equal to the firm's WACC minus 2 percent to division X and a rate equal to the firm's WACC plus 3 percent to division Y. The company has a debtequity ratio of .65 and a tax rate of 35 percent. The cost of equity is 9 percent and the aftertax cost of debt is 5 percent. Presently, each division is considering a new project. Division Y's project provides a 9.5 percent rate of return and division X's project provides a 6.2 percent return. Which projects, if either, should the company accept?
a. accept both X and Y
b. accept X and reject Y
c. reject X and accept Y
d. reject both X and Y
e. The answer cannot be determined without additional information.
Respond to this Question
Similar Questions

Transfer Pricing
The per unit cost details are as followers: Machining Finishing Transferred in cost N/A $27 Variable cost $24 9.00 Allocated fixed costs 3.00 13.50 Full cost per unit 27.00 49.50 An external supplier has offered to supply a product … 
math
how do i do long division? This web site may help you. http://www.coolmath4kids.com/longdivision/longdivisionlesson1.html dont listen to drbob222 
Pre Calc (For Reiny)
Thanks so much your method worked perfectly! My solution was: the remaining zeros were 5+2i, 3, and 4 I have one question that's bugging me though, why is it that synthetic division did not work for me? 
college Managerial accounting
Problem 47 Simon Hinson Company operates two divisions: Gordon and Ronin. A segmented income statement for the company’s most recent year is as follow: Total Company Gordon Division Ronin Division Sales $850,000 $250,000 $600,000 … 
lisa
This is a question given to me to answer:How is dividing a polynomial by a binomial similar to or different from the long division you learned in elementary school? 
Quadratic Long Division question?
How do i do this using long division? This is part of a Partial Fractions Question. Please help, thanks! (x^3) / (x^3  2x^2 + 3x  18) I tried using long division, but I could only get a quotient of 1, and a remainder of 2x^2  3x 
business
Direct verse indirect cost Estep Construction Company is composed of two divisions: (1) Home Construction and (2) Commercial Construction .The Home Construction Division is in the process of building 12 houses and the Commercial Division … 
Economics
A large firm has two divisions: an upstream division that is a monopoly supplier of an input whose only market is the downstream division that produces the final output. To produce one unit the final output, the downstream division … 
Math
In a sports league there are two divisions with eight teams each. Each team plays every other team within its division 12 times, but it plays only 6 games with each team from the other division. In all, how many games are played by … 
college finite math
A division of a company produces "Personal Income Tax" diaries. Each diary sells for $6. The monthly fixed costs incurred by the division are $30,000, and the variable cost of producing each diary is $1. (a) Find the breakeven point …