Question1: When determining the after __________ tax cost of a bond, the face value of the issue must be adjusted to the net proceeds amounts by considering
[A] The approximate returns
[B] The taxes
[C] The risk
[D] The floatation costs
Question2: The Corporation has ten million dollars in 10 percent preferred stock outstanding and a 40 percent tax rate. The amount of earnings before interest and taxes [EBIT require to pay the preferred dividends is]
[A] $600,000
[B] 1,666,667
[C] 1 million dollars
[D] $400,000
Question3: The investment opportunity scheduled combined with the weighted marginal costs of capital indicates
[A] Which projects are acceptable given the firm's cost of capital
[B] Which combination of projects will fit within the firm's capital budget
[C] Those projects that a firm should select
[D] Those projects that will result in the highest cash flows