A bank is considering two alternatives for handling its projected number of service calls in the next decade (you should consider this as one period). If the bank sets up its own service call center in the U. S., the fixed cost is estimated to be $3,200,000.00, and the variable cost is calculated to be 29 cents per call. If the call service is outsourced to a foreign company, the fixed cost would be $150,000.00, and the unit charge would be 54 cents per call. Required:
a. What is the break-even number of service calls?
b. Draw a diagram representing the in-house and outsourcing total costs which are functions of the number of service calls. Indicate the break-even number of service calls on the diagram.

Afirm's before-tax cost of debt, rd, is the interest rate that the firm must pay on debt. because interest is tax deductible, the relevant cost of debt used to calculate a firm's wacc is the cost of debt, rd (1 – t). the cost of debt is used in calculating the wacc because we are interested in maximizing the value of the firm's stock, and the stock price depends on cash flows. it is important to emphasize that the cost of debt is the interest rate on debt, not debt because our primary concern with the cost of capital is its use in capital budgeting decisions. the rate at which the firm has borrowed in the past is because we need to know the cost of capital. for these reasons, the on outstanding debt (which reflects current market conditions) is a better measure of the cost of debt than the . the on the company's -term debt is generally used to calculate the cost of debt because more often than not, the capital is being raised to fund -term projects. quantitative problem: 5 years ago, barton industries issued 25-year noncallable, semiannual bonds with a $1,600 face value and a 8% coupon, semiannual payment ($64 payment every 6 months). the bonds currently sell for $845.87. if the firm's marginal tax rate is 40%, what is the firm's after-tax cost of debt? round your answer to 2 decimal places. do not round intermediate calcu

Acompany that uses the periodic inventory system provided the following information: 1. beginning inventory $ 5 comma 0002. purchases $ 150 comma 0003. purchase discounts $ 2 comma 1004. purchase returns and allowances $ 1 comma 000at the end of the period, the physical count of inventory reveals that $ 16 comma 000 worth of inventory is on hand. what is the amount of cost of goods sold?

What is a potential negative effect of an expansionary policy? decreased borrowing increased interest rates increased inflation decreased available credit