Bad Boys, Inc

A- Bad Boys, Inc- is evaluating its cost of capital- Under consultation, Bad Boys, Inc- expects to issue new debt at par with a coupon rate of 8% and
to issue new preferred stock with a $2-50 per share dividend at $25 a share- The common stock of Bad Boys, Inc- is currently selling for $2000 a
share- Bad Boys, Inc- expects to pay a dividend of $1 -50 per share next year- An equity analyst foresees a growth in dividends at a rate of 5% per
year- Bad Boys, Inc- marginal tax rate is 35%- If Bad Boys, Inc- raises capital using 45% debt, 5% preferred stock, and 50% common stock, what is
Bad Boys cost of capital?

8. If Bad Boys, Inc- raises capital using 30% debt, 5% preferred stock, and 65% common stock, what is Bad Boys cost of capital?

C- On page 457, your textbook details the term Cannibalization- In your own words, identify two corporations that have dealt with cannibalization and
what steps were taken to overcome the cannibalization