6. (TCO 1) Recent announcements of massive layoffs have increased stock prices for certain companies. Critics argue that this reaction encourages companies to fire employees. Do you agree or disagree? (Points : 10)

Question 7. 7. (TCO 4) What are erosion costs? Provide one real-life example of an erosion cost for a project. Should erosion costs be included as project cash flows? Why or why not? Explain your rationale. (Points : 10)

Question 8. 8. (TCO 8) What is the difference between systematic and unsystematic risk? Provide one example of each. Can both systematic and unsystematic risks be diversified? Why or why not? (Points : 10)

Question 9. 9. (TCO 2) What are the costs associated with extending (or not extending) a credit policy to customers? (Points : 10)

Question 10. 10. (TCO 6 and 7) How can you calculate the cost of debt? What methods can you use? Provide at least two examples. (Points : 10)