Today, most firms would prefer having employees belong to unions because the unions handle health benefits

S. Bouchard and Company hired you as a consultant to help estimate its cost of common equity. You have obtained the following data: D0 = $0.85; P0 = $22.00; and g = 6.00% (constant). The CEO thinks, however, that the stock price is temporarily depressed, and that it will soon rise to $40.00. By how much would the cost of common from retained earnings change if the stock price changes as the CEO expects?

A) -1.49% B) -1.66% C) -1.84% D) -2.03%

Captive sourcing is an arrangement in which the focal firm contracts with an independent supplier to manufacture products according to well-defined specifications

Indicate whether the statement is true or false