<span>9.20 percent
Re= 0.036 +1.2(0.085) = 0.138
Re= [($1.10 x 1.02)$19] +.02 = 0.0790526
ReAverage = (0.138 + 0.0790526)/2 = 0.108526
WACC = (1/1.65)(0.108526) + (0.65/1.65)(0.098)(1-0.32) = 9.20 percent</span>
<u><em>Answer:</em></u>
<u><em>1. Likely the price of the stock either goes up or falls</em></u>
<u><em>2. There is no need for a stop loss order in this scenario.</em></u>
<u><em>3. 5412541.2</em></u>
<u>Explanation</u>:
1. Stock market prices are often unstable, prices can be up today, the next day they are low.
2. Arianna has already made over 100% profit from the stock since she purchased at a good low price, yesterday's stock close price was still profit for her.
3. A 10% Stop loss price would have been the idea order price rather than the $53.7353.73.
4. Remember Stop loss order are meant to reduce or minimize the loss of investor or trader, a <em>calculated level </em>of should be carefully decided.
