Cissy is currently running a bookstore, with a revenue of $100,000 and explicit cost of $40,000 per year. If she closes her bookstore and opens a restaurant, her total revenue will be $165,000 and her explicit cost will be $65,000 per year. If Cissy closes her bookstore and opens a restaurant, what will her annual accounting profit be

The common stock and debt of northern sludge are valued at $65 million and $35 million, respectively. investors currently require a return of 15.9% on the common stock and a return of 7.8% on the debt. if northern sludge issues an additional $14 million of common stock and uses this money to retire debt, what happens to the expected return on the stock? assume that the change in capital structure does not affect the interest rate on northern’s debt and that there are no taxes.