Reference no: EM132572528

Question 1: CANDY SHOP is a candy stand in a mall. The average selling price of a 100 g of candy is $2.5 and the average variable expense per 100 g is $0.4. The average fixed expense per month is $2,300. An average of 42 KG is sold each month. How many kilograms of candy would have to be sold to attain target profits of $900 per month?

Option 1: 91.6 KG

Option 2: 83.8 KG

Option 3: 67.6 KG

Option 4: 114.2 KG

Question 2: If the price of XYZ common stock today is $50, dividend at the end of the year is $3; and constant growth rate in dividends is 8%, what is the cost of common equity?

Option 1: 14%

Option 2: 12%

Option 3: 18%

Option 4: 16%