Suppose that it costs $5 to produce a low-quality electric stapler and $30 to produce a high-quality stapler. consumers cannot distinguish between good staplers and poor staplers when they make their purchases. there are five firms producing staplers. consumers value staplers at their cost of production and are risk neutral. will any of the five firms be able to produce high quality staplers without making losses? suppose each firm produces 100 staplers. if one firm makes high-quality staplers, then each firm that produces low-quality staplers will earn profit of $ nothing and the firm that makes the high-quality staplers will earn $ nothing. (enter your responses as whole numbers and include a minus sign if necessary.)

Proportion of us adults who own a cell phone. in a survey of 1006 us adults in 2014, 90% said they had a cell phone.1

Your aunt is thinking about opening a hardware store. she estimates that it would cost $300,000 per year to rent the location and buy the stock. in addition, she would have to quit her $45,000 per year job as an accountant. a. define opportunity cost. b. what is your aunt's opportunity cost of running a hardware store for a year? if your aunt thought she could sell $350,000 worth of merchandise in a year, should she open the store? explain.

If a firm plans to issue new stock, flotation costs (investment bankers' fees) should not be ignored. there are two approaches to use to account for flotation costs. the first approach is to add the sum of flotation costs for the debt, preferred, and common stock and add them to the initial investment cost. because the investment cost is increased, the project's expected return is reduced so it may not meet the firm's hurdle rate for acceptance of the project. the second approach involves adjusting the cost of common equity as follows: . the difference between the flotation-adjusted cost of equity and the cost of equity calculated without the flotation adjustment represents the flotation cost adjustment. quantitative problem: barton industries expects next year's annual dividend, d1, to be $1.90 and it expects dividends to grow at a constant rate g = 4.3%. the firm's current common stock price, p0, is $22.00. if it needs to issue new common stock, the firm will encounter a 6% flotation cost, f. assume that the cost of equity calculated without the flotation adjustment is 12% and the cost of old common equity is 11.5%. what is the flotation cost adjustment that must be added to its cost of retaine