1. What are the differences between the following alternatives?

1- Obtain private debt financing

2- Seek out a private investor(s) who would be willing to share ownership

3- Seek out offers for a private buy-out

4- Issue public debt (corporate bonds)

5- Issue public common stock

2. Trevor has a portfolio valued at $4,500. Of this amount, $3,150 is invested in Home Center stock and the remainder is invested in Garden Flower stock. The expected rate on Home Center stock is 15.4 percent and the expected return on Garden Flower stock is 9.8 percent. What is the expected return on Trevor’s portfolio?

a) 8.97 percent b) 10.78 percent c) 12.60 percent d) 13.72 percent e) 14.99 percent