Pursue aggressive or conservative working


Zorn Corporation is deciding weather to pursue aggressive or conservative working capital investment policy. the firms annual sales are expected to total $3,600,000, its fixed assets will be $900,000, and its debt and common equity are each 50Z% of total assets. EBIT is $150,000, the interest rate on the firms debt is 10%, and the tax rate is 40%. if the company follows an aggressive policy, its current assets will be $540,000. Under a conservative policy, its current assets will be $750,000. A. determine the return of equity for the conservative policy and the aggressive policy B.which policy is the more risky one? explain.

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Mathematics: Pursue aggressive or conservative working
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