Bunkhouse electronics is a recently incorporated firm that makes electronic entertainment systems. its earnings and dividends have been growing at a rate of 30%, and the current dividend yield is 2%. its beta is 1.2, the market risk premium is 8%, and the risk-free rate is 4%. (lo13-4) a. use the capm to estimate the firm’s cost of equity. b. now use the constant growth model to estimate the cost of equity. c. which of the two estimates is more reasonable?

Suppose that hubert, an economist from an am talk radio program, and kate, an economist from a nonprofit organization on the west coast, are arguing over government bailouts. the following dialogue shows an excerpt from their debate: kate: to recent financial crises, the concept of bailouts is a hot topic for debate among everyone these days. hubert: indeed, it’s gotten crazy! a government bailout of severely distressed financial firms is unnecessary because free markets will properly price assets. kate: i don’t know about that. without a bailout of severely distressed financial firms, the economy will experience a deep recession. the disagreement between these economists is most likely due todifferences in scientific judgments . despite their differences, with which proposition are two economists chosen at random most likely to agree? business managers can raise profit more easily by reducing costs than by raising revenue. central banks should focus more on maintaining low unemployment than on maintaining low inflation. employers should not be restricted from outsourcing work to foreign nations

Cherokee inc. is a merchandiser that provided the following information: amount number of units sold 20,000 selling price per unit $ 30 variable selling expense per unit $ 4 variable administrative expense per unit $ 2 total fixed selling expense $ 40,000 total fixed administrative expense $ 30,000 beginning merchandise inventory $ 24,000 ending merchandise inventory $ 44,000 merchandise purchases $ 180,000 required: 1. prepare a traditional income statement. 2. prepare a contribution format income statement.

What are some examples of types of investments on the part of manufactures that result in growth? how does this improve a nation's standard of living?