Question 1 (1 point) Boise Corporation reported ROA of 4%, ROE of 6%, and Sales/Total assets ratio of 2.0 last year. What is the Boise's debt ratio? o 1) 67% 2) 33% 3) 47% 4) 13% Question 2 (1 point) The purchase of a new machine would increase the firm's revenues by $20,000 and operating costs by $5,000 each year. It also would increase its depreciation by $6,000 per year. What is the incremental operating cash flow (The firm's tax rate is 40%)? 01) $11,520 O2) $9,520 03) $9.400 04 $11.400 Question 3 (1 point) According to the NPV rule, which of the following statement is most correct? 01) Accept an Independent project If the NPV 3) Accept an independent project if the NPV-0. 4) None of the above. Question 4 (1 point) The difference in cost between retained earnings and new stock financing is due to: o 1) The corporate tax code. 2) The agency problems. 3) The flotation costs. O4) None of the above. Question 5 (1 point) The after-tax cost of debt is lower than the before-tax cost of debt. The reason is that: o 1) Companies can deduct interest payments from taxable incomes. O2) Bondholders can deduct interest payments from taxable incomes. 3) Bondholders can claim tax credit of Interest payments. 04) None of the above