Sanford company currently has 15% of its market value in debt and 85% in common stock, with no preferred stock. its debt has a coupon rate of 7%, a yield-to-maturity of 6%, and a corporate tax rate of 35%. the expected market return is 11% and the risk-free rate is 3%. sanford has a beta of 0.90.

WACC is 9.35%

Explanation:

In order for us to compute the weighted average cost of capital, we have to first find the cost of equity (Ke) and the cost of debt (Kd)

1. Ke can be found by using CAPM - Capital Asset Pricing Model.

CAPM Formula: Ke = Rf + b(Rm-Rf)

where Rf = Risk free rate; Rm = Return expected of the market; b = beta

Therefore = Ke = 3% + 0.9(11%-3%) = 10.2%

2. Kd = Coupon rate (1 - tax rate), coupon rate is 7%, tax rate is 35%

therefore Kd = 7 (1-0.35) = 4.35%

Lastly we apply the WACC Formula which is Ke* (equity value/Total value of equity and debt) + kd*(debt value/Total value of equity and debt)

We are not given the values of equity and debt, bur we are given the fractions; we will use the fractions.

Therefore: Ke* (equity value/Total value of equity and debt) + kd*(debt value/Total value of equity and debt) = (10.2%*85%)+(4.35%*15%) = 9.35%

ans.

heterothermic organisms include those organisms that can switch between homeothermic (having body temperature higher than environment) and poikilothermic (having variation in internal body temperature) strategies.

some migratory birds show heterothermy as they decrease their metabolic rate during cold nights to keep their body temperature low. drop in metabolic rate allows increase in production efficiency of birds that reduces the internal body temperature to make it equal to external cold temperature during cold nights.

thus, the correct answer is 'birds allow their temperature drop in order to increase their production efficiency.'

answer; the coefficient of determination;