Jack's Construction Co. has 80,000 bonds outstanding that are selling at par value ($1,000). Bonds with similar characteristics are yielding 8.5%. The company also has 4 million shares of common stock outstanding. The stock has a beta of 1.1 and sells for $40 a share. The U. S. Treasury bill is yielding 4% and the market risk premium is 8%. Jack's tax rate is 35%. What is Jack's weighted average cost of capital

Which of the following best describes the economic effect that results from the government having a budget surplus? a. consumers save more and spend less, enabling long-term financial planning. b. overall demand decreases, reducing the incentive for producers to increase production. c. banks have more deposits, enabling them to make more loans to investors. d. government spending increases, increasing competition for goods and services and driving prices up.