An analyst has gathered the following data about a company with a 12 percent cost of capital.Project AProject BInitial cost$15000$20000Life5years4yearsCash inflows$5000/year$7500/year Which of the following statements concerning Board committees is FALSE
A. The audit committee has authority over the procedures used to audit the entire corporate group including subsidiaries and affiliates.
B. The compensation committee should consist of independent members and link executive compensation to long-term performance.
C. Members of the audit committee should be independent experts in accounting and finance.
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An analyst has gathered the following data about a company with a 12 percent cost of capital.Project AProject BInitial cost$15000$20000Life5years4yearsCash inflows$5000/year$7500/year If a company has a net profit margin of 15 percent, an asset turnover ratio of 4.5 and a ROE of 18 percent, what is the equity multiplier
A. 0.523.
B. 0.267.
C. 2.667.
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