The free cash flow hypothesis states:. a. that firms with greater free cash flow will pay more in dividends reducing the risk of financial distress.
b. that firms with greater free cash flow should issue new equity to force managers to minimize wasting resources and to work harder.
c. that issuing debt requires interest and principal payments reducing the potential of management to waste resources.
d. Both A and C.
e. Both B and C.

Awell-written business plan can improve your chances of getting funding and give you more free time. improved logistics. greater negotiating power.

Read the following scenario and answer the question in 5-10 sentences. you are the owner of a small business that is a defendant in a lawsuit in federal court. you received bad news from your lawyer that the judge did not allow certain documents to be admitted as evidence in court and that the jury reached a $50,000 verdict in favor of the plaintiff. your lawyer tells you that it is within your legal right to hire him to file an appeal with the united states court of appeals. if the appellate court rules in your favor, you may be able to avoid paying part or all of the $50,000. evaluate your lawyer’s suggestion about appealing the decision.

Carlton industries is considering a new project that they plan to price at $74.00 per unit. the variable costs are estimated at $39.22 per unit and total fixed costs are estimated at $12,085. the initial investment required is $8,000 and the project has an estimated life of 4 years. the firm requires a return of 8 percent. ignore the effect of taxes. what is the degree of operating leverage at the financial break-even level of output?