Indicate by a (+), or (0) whether each of the following events would probably cause a/r, sales, and profits to increase, decrease, or be affected in an indeterminate manner. also provide an explanation for each event and the affects. (7pts)

ar sales profit

a. the firm tightens its credit

standards.

b. the terms of trade are

changed from 2/10, net 30,

to 3/10, net 30.

c. the terms are changed from

2/10 net 30, to 3/10, net 40.

d. the credit manager gets tough

with past-due accounts

Moody farms just paid a dividend of $3.95 on its stock. the growth rate in dividends is expected to be a constant 5 percent per year indefinitely. investors require a return of 14 percent for the first three years, a return of 12 percent for the next three years, and a return of 10 percent thereafter. what is the current share price?

Examine the following book-value balance sheet for university products inc. the preferred stock currently sells for $30 per share and pays a dividend of $3 a share. the common stock sells for $16 per share and has a beta of 0.9. there are 2 million common shares outstanding. the market risk premium is 9%, the risk-free rate is 5%, and the firm’s tax rate is 40%. book-value balance sheet (figures in $ millions) assets liabilities and net worth cash and short-term securities $ 2.0 bonds, coupon = 6%, paid annually (maturity = 10 years, current yield to maturity = 8%) $ 5.0 accounts receivable 3.0 preferred stock (par value $15 per share) 3.0 inventories 7.0 common stock (par value $0.20) 0.4 plant and equipment 21.0 additional paid-in stockholders’ equity 13.6 retained earnings 11.0 total $ 33.0 total $ 33.0 a. what is the market debt-to-value ratio of the firm? (do not round intermediate calculations. enter your answer as a percent rounded to 2 decimal places.) b. what is university’s wacc? (do not round intermediate calculations. enter your answer as a percent rounded to 2 decimal places.)

Stock market crashes happen when the value of most of the stocks in the stock market increase at the same time. question 10 options: true false