1. Consider credit terms of 2/20, net 40. What effective rate does a buyer pay by not taking the discount? What would be the APR if one were quoted?
2. Lannister Manufacturing has a target debt equity ratio of .70. Its cost of equity is 14 percent, and its cost of debt is 7 percent. If the tax rate is 38 percent, what is the company’s WACC? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC %
3. "Consider the following data on an asset Cost of the asset, I = $335,000 Useful life, N = 6 years Salvage value, S = $84,000 Compute the annual depreciation amount using the straight-line depreciation method."