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Allushta [10]
3 years ago
10

Precise Electronics Inc. has projected EBIT to be $225,000 for next year. Their tax rate is 21% and there is $`500,000 in equity

. Precise Electronics Inc has no debt currently, but the board is considering a loan of $150,000 at 8% interest, which they will use to repurchase shares of their own stock at $50 per share. If there is a recession, EBIT could be only 75% of projected. If there is an expansion, EBIT might be 40% greater than projected. What will their return on equity be under the current structure and under the proposed structure for each scenario? Is the restructuring a good idea?
Current Structure:
Worst Case________Base Case________Best Case________.
Proposed Structure:
Worst Case________Base Case________Best Case ________.
Should they do the re-structuring?
A. Yes.
B. No
Business
1 answer:
777dan777 [17]3 years ago
4 0
the answer is no just took test
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Answer:

The correct answer is C. Mail questionnaires.

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Given that the company needs honest and sincere feedback regarding the quality of its products, and that its clients have so far not given the desired answers due to their education and lack of critical focus as a way to avoid hypothetical conflicts, the correct way to obtain honest and impersonal feedback regarding the quality of their products would be through mail questionnaires.

This is so because through these questionnaires, direct contact between the members of the company and its clients would be avoided, making the criticism or assessment much less personal for the client, which could be expanded without fear of possible reproach on the part of the members of Loft Industries. In this way, a space of sincere expression would be generated that would allow an objective assessment on the part of the clients.

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