1. Company A has an outstanding debt obligation (total of principle and interest due) to Company B of $250 (Assume this is Simple's only debt.). It is year end and the total cash flow of Simple from all sources is $325. The contingent payoff to the debt and equity holders of Compnay A is:
$250; $75
$250; $325
$75; $250
$325; $250
none of the other responses are reasonable
2. A new project is being considered by investors in the area. An outlay of $40,000 is required for equipment and an additional net working capital investment of $1000 is required. What is the total cost at time zero of accepting this project?
40,000
41,000
30,000
31,000