Drogo, inc., is trying to determine its cost of debt. the firm has a debt issue outstanding with 12 years to maturity that is quoted at 110 percent of face value. the issue makes semiannual payments and has an embedded cost of 6 percent annually.
a. what is the company’s pretax cost of debt? (do not round intermediate calculations. enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.)
pretax cost of debt %.
b. if the tax rate is 35 percent, what is the aftertax cost of debt? (do not round intermediate calculations. enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.)
aftertax cost of debt %.

An office manager is concerned with declining productivity. despite the fact that she regularly monitors her clerical staff four times each day—at 9: 00 am, 11: 00 am, 1: 00 pm, and again at 3: 00 pm—office productivity has declined 30 percent since she assumed the helm one year ago. would you recommend that the office manager invest more time monitoring the productivity of her clerical staff? explain.

What is an example of a good stock to buy during economic expansion? a) cyclical stock b) defensive stock c) income stock d) bond

5. profit maximization and shutting down in the short run suppose that the market for polos is a competitive market. the following graph shows the daily cost curves of a firm operating in this market. 0 2 4 6 8 10 12 14 16 18 20 50 45 40 35 30 25 20 15 10 5 0 price (dollars per polo) quantity (thousands of polos) mc atc avc for each price in the following table, calculate the firm's optimal quantity of units to produce, and determine the profit or loss if it produces at that quantity, using the data from the previous graph to identify its total variable cost. assume that if the firm is indifferent between producing and shutting down, it will produce. (hint: you can select the purple points [diamond symbols] on the previous graph to see precise information on average variable cost.) price quantity total revenue fixed cost variable cost profit (dollars per polo) (polos) (dollars) (dollars) (dollars) (dollars) 12.50 135,000 27.50 135,000 45.00 135,000 if the firm shuts down, it must incur its fixed costs (fc) in the short run. in this case, the firm's fixed cost is $135,000 per day. in other words, if it shuts down, the firm would suffer losses of $135,000 per day until its fixed costs end (such as the expiration of a building lease). this firm's shutdown price—that is, the price below which it is optimal for the firm to shut down—is per polo.