A& z inc. averages $4 million taxable income a year. because it needs an infusion of cash, the board of directors is considering two options: selling a new issue of preferred stock to the public for a total offering price of $500,000 or borrowing $500,000 from a local bank. the market dividend rate on preferred stock is only 5.6 percent, while the bank’s interest rate is 9 percent. which option minimizes the after-tax cost of the new capital?
-selling a new issue of preferred stock to the public
- borrowing funds from a local bank

Synovec co. is growing quickly. dividends are expected to grow at a rate of 24 percent for the next three years, with the growth rate falling off to a constant 7 percent thereafter. if the required return is 11 percent, and the company just paid a dividend of $2.05, what is the current share price? (do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Acompany that makes shopping carts for supermarkets and other stores recently purchased some new equipment that reduces the labor content of the jobs needed to produce the shopping carts. prior to buying the new equipment, the company used 6 workers, who produced an average of 79 carts per hour. workers receive $16 per hour, and machine coast was $49 per hour. with the new equipment, it was possible to transfer one of the workers to another department, and equipment cost increased by $11 per hour while output increased by four carts per hour. a) compute the multifactor productivity (mfp) (labor plus equipment) under the prior to buying the new equipment. the mfp (carts/$) = (round to 4 decimal places). b) compute the productivity changes between the prior to and after buying the new equipment. the productivity growth = % (round to 2 decimal places)

3. describe the purpose of the sec. (1-4 sentences. 2.0 points)