Baxter Inc has a target capital structure of 30% debt, 15% preferred stock, and 55% common equity
The company's after-tax cost of debt is 7%, its cost of preferred stock is 11%, its cost of retained
earnings is 15%, and its cost of new common stock is 16%. The company stock has a beta of 1.5 and
the company's marginal tax rate is 35%. What is the company's weighted average cost of capital if
retained earnings are used to fund the common equity portion?
A) 13.80% B) 11.20% C) 12.00% D) 14.45%
C
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Which of the following is true of a vertical marketing system?
A) It is formed when two or more companies at one level join together to follow a new marketing opportunity. B) It is formed when a single firm sets up two or more marketing channels to reach one or more customer segments. C) It does not give overall power to any one member in the channel. D) It has each channel member acting as a separate business unit trying to maximize its own profits. E) It has one channel member owning all the other channel members or has contracts with all other channel members.
The matrix multiplication (AB), where A and B are any matrix, is equal to the matrix multiplication (BA)
Indicate whether the statement is true or false