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NEW QUESTION: 1
A company hired a firm to test the security posture of its database servers and determine if any vulnerabilities can be exploited. The company provided limited imformation pertaining to the infrastructure and database server. Which of the following forms of testing does this BEST describe?
A. Vulnerability scanning
B. Black box
C. Gray box
D. White box
Answer: C

NEW QUESTION: 2


Answer:
Explanation:

Explanation

NEW QUESTION: 3
A firm's earnings break point equals $98 million. Its net income is $58 million and it is committed to a dividend payout ratio of 30%. It's after-tax cost of debt equals 9% and its shareholders demand an expected rate of return of 15%. The firm's WACC equals ________.
A. 9.8%
B. 10.3%
C. 11.5
D. 12.2%
Answer: C
Explanation:
Explanation/Reference:
Explanation:
The retained earnings of the firm = $58*0.7 = $40.6 million. If the earnings breakpoint is $98 million then the firm must issue $(98-40.6) = $57.4 million in debt to maintain constant D/E ratio. This implies that the firm's D/E ratio equals 57.4/40.6 = 1.41. Debt comprises 57.4/98 = 58.57% of the capital structure.
Therefore, WACC = 0.5857*0.09 + 0.4143*15% = 11.49%.