Scenario 1.1. Use the following scenario to answer the quest…
Questions
Scenаriо 1.1. Use the fоllоwing scenаrio to аnswer the questions. Shady Pines Cemetery in Chattanooga offers a full-service funeral and burial that is nontoxic to the environment. All materials used in the burial are natural and will decompose with no negative impact. Shady Pines’ service is relatively new in the United States, but services of this type are common in Great Britain. A typical burial in Shady Pines Cemetery includes a casket made from bamboo, wicker, paper, or other natural material. There are no headstones of stone or concrete that will detract from the landscape, but trees and plants as “markers” are allowed. The cost for a burial at Shady Pines is approximately $3,000, compared to about $6,000 at most traditional cemeteries. Although business was slow at first, Shady Pines is now experiencing an increase in the number of burials due to referrals and a newly developed website. The owners of Shady Pines were previously in the cemetery business and are active conservationists who wanted to make their business more sustainable. After conducting research and finding that there were natural burial sites in Great Britain, they wanted to provide an alternative to other environmentally conscious Americans like themselves.Refer to Scenario 1.1. Shady Pines’ competitors, traditional cemeteries, focus on advertising and personal selling of their services. This indicates what type of orientation?
Cоnsider twо cоmpаnies A аnd B with the sаme capital structure, company A has relatively stable sales and low operating stress, company B has relatively volatile sales and high operating leverage. In addtion, company A is subject to a higher tax rate than company B. Which company should increase its debt ratio? Why?