<u>By choosing </u><u>high-risk ventures,</u><u> stockholders steal wealth from bondholders. The incentive for underinvestment is one of </u><u>bankruptcy's</u><u> </u><u>indirect costs. </u>
- Underinvestment would typically lead to - The company rejecting profitable proposals that would unquestionably be approved if the company were fully funded by equity.
How does a company's capital structure get impacted by bankruptcy costs?
- The likelihood of bankruptcy may rise as a result of higher capital expenses and increased risk.
- The company's WACC rises over the ideal level when additional debt is added to its capital structure, raising the cost of bankruptcy even more.
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The Market Revolution change the role of work for women because It provided the opportunity for some women to work in mill towns instead of their family's farm.
<h3>What is the
Market Revolution?</h3>
It refers to the period of marketplace expansion throughout the early america that brought distance communities together and created a specialized and interdependent economy.
During the period, the role of work for women changed because It provided the opportunity for some women to work in mill towns instead of their family's farm.
Therefore, the Option A is correct.
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Answer: weakened host immune system and other factors like his anti-hypertensive medications predisposed Mr HH to community acquired pneumonia.
Explanation:
Having a past medical history of
Chronic Obstructive pulmonary disease (COPD), Hypertension, Hyperlipidemia and diabetes, Me HH has a higher risk of developing community acquired pneumonia through the following ways...
Having a past medical history of Chronic obstructive pulmonary disease ascertains that he might have the bacteria Streptococcus pneumoniae, Haemophilus influenzae, Chlamydia pneumoniae, Mycoplasma pneumoniae, and Legionella pneumophila which are the main causative organism of pneumonia and therefore will vkme down with community acquired pneumonia once the immune system is compromised.
Hypertension predisposes Mr HH to community acquired pneumonia through the use of certain anti-hypertensive medications like calcium channel blockers which tends to decrease phagocyte function and host defence.
Digoxin a cardiac glycoside decreases the clearance of pneumococci from lower respiratory tree.
Delayed emptying of the stomach with comes with diabetes can lead to aspiration this further resulting In pneumonia (community acquired pneumonia)
Diabetes and Hyperlipidemia impairs neutrophils and monocytes (macrophages) function thereby wearing the host immune response and further encouraging micro organisms that cause pneumonia to thrive.
Answer:
I) The firm will reject good low-risk projects
II) The firm will accept poor high-risk projects
Explanation:
<h2>Cost of Capital:</h2>
- The required return on the existing firm assets. It is based on the risk of assets.
- The risk of firm’s overall assets is equal to the weighted average risks of firm’s debt, preferred stock and common equity.
- The cost of capital of a firm equals the weighted average of the cost of debt, the cost of preferred stock, and the cost of common equity
Each project has different risk profiles, using one cost of capital for project evaluation might provide misleading results and the investor or company may end up accepting high risk projects or may reject low risk good projects.
