Florida corp. is calculating the appropriate rate for discounting cash flows on a project valued using the apv method. florida’s target debt ratio (d/(d+e)) in market value terms is 50%, and the yield-to-maturity on its outstanding debt is 6%. a comparable firm has an equity beta of 1.4 and a debt ratio (d/(d+e)) of 40%. assume a risk-free rate of 5% and a market risk premium of 8%. florida’s tax rate is 40%. what discount rate should florida use?

Aproperty title search firm is contemplating using online software to increase its search productivity. currently an average of 40 minutes is needed to do a title search. the researcher cost is $2 per minute. clients are charged a fee of $400. company a's software would reduce the average search time by 10 minutes, at a cost of $3.50 per search. company b's software would reduce the average search time by 12 minutes at a cost of $3.60 per search. which option would have the higher productivity in terms of revenue per dollar of input?