The president and CFO of Spellman Transportation are having a disagreement about whether to use market value or book value weights in calculating the WACC. Spellman's balance sheet shows a total of non-callable $45 million long-term debt with a coupon rate of 7.00% and a yield to maturity of 6.00%. This debt currently has a market value of $50 million. The company has 10 million shares of common stock, and the book value of the common equity (common stock plus retained earnings) is $65 million. The current stock price is $22.50 per share; stockholders' required return, rs, is 14.00%; and the firm's tax rate is 40%. The CFO thinks the WACC should be based on market value weights, but the president thinks book weights are more appropriate. Required:
What is the difference between these two WACCs?

All else being equal, which is true about a firm with high operating leverage relative to a firm with low operating leverage? select one: a. a higher percentage of the high operating leverage firm's costs are fixed. b. the high operating leverage firm is exposed to less risk. c. the debt payments limit the high operating leverage firm's opportunities to turn a big profit. d. the high operating leverage firm has more debt.

Acompany is developing a new high­performance wax for cross country ski racing. in order to justify the price marketingwants, the wax needs to be very fast. specifically, the mean time to finish their standard test course should be less thanseconds for a former olympic champion. to test it, the champion will ski the course 8 times. the champion's times(selected at random) are 59.9 61.9 48.8 52.2 46.6 45.3 50.6 and 41.1 seconds to complete the test course. complete parts a and b below. a) should they market the wax? assume the assumptions and conditions for appropriate hypothesis testing are metfor the sample. assume=0.05. what are the null and alternative hypotheses? choose the correct answer below. b) suppose they decide not to market the wax after the test, but it turns out that the wax really does lower the champion'saverage time to less thanseconds. what kind of error have they made? explain the impact to the company of such anerror.

In order to be thoughtful about the implementation of security policies and controls, leaders must balance the need to reduce with the impact to the business operations. doing so could mean phasing security controls in over time or be as simple as aligning security implementation with the business’s training events.