1.) A manager is comparing two projects (projects A and B) and concludes that project A is the better project because it has the shortest payback period.

Briefly analyze the manager's conclusion and list two reason why the conclusion might not be in the company's best interests.

2.) Briefly discuss the pros and cons of a firm having a relatively high amount of operating leverage. In your discussion,talk aboutcircumstances a firm would benefit from high operating leverage and circumstances a firm would suffer from high operating leverage.

3.)Ifa firm wanted to decrease its financial leverage, describe how a manager could change the capital structure (mix of debt/equity) of the firm to do so.