Two firms, A and B, both produce brushes. The price of brushes is $1.90 each. Firm A has total fixed costs of $464,000 and variable costs of 48 cents per brush. Firm B has total fixed costs of $260,000 and variable costs of 72 cents per brush. The corporate tax rate is 35%. If the economy is strong, each firm will sell 1,500,000 brushes. If the economy enters a recession, each firm will sell 987,000 brushes. Required:
If the economy enters a recession, what will be the after-tax profit of Firm A?

Gerda, a real estate agent, is selling a moderately priced house in a subdivision. she knows from her uncle that the factory being built half a mile from the subdivision will be manufacturing dog food, using a process that creates a very strong odor that permeates the surrounding neighborhood. a buyer, who is unaware of the type of factory under construction, makes an offer on one of the houses gerda is selling, and within a short time, the deal goes through. what does this scenario best illustrate?

Anew firm is developing its business plan. it will require $615,000 of assets, and it projects $450,000 of sales and $355,000 of operating costs for the first year. management is reasonably sure of these numbers because of contracts with its customers and suppliers. it can borrow at a rate of 7.5%, but the bank requires it to have a tie of at least 4.0, and if the tie falls below this level the bank will call in the loan and the firm will go bankrupt. what is the maximum debt ratio the firm can use? (hint: find the maximum dollars of interest, then the debt that produces that interest, and then the related debt ratio.)a. 41.94%b. 44.15%c. 46.47%d. 48.92%e. 51.49%

You need $87,000 in 12 years. required: if you can earn .54 percent per month, how much will you have to deposit today?