Krell Industries has a share price of $21.25 today. If Krell is expected to pay a dividend of $1.06 this year, and its stock price is expected to grow to $24.73 at the end of the year, what isKrell's dividend yield and equity cost of capital?

A) Krell's dividend yield is?

B) Krell's capital gain rate is?

C) Krell's equity cost of capital, or expected total return is?

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Orthopedic surgeons can make two different treatment recommendations for chronic knee pain: a less aggressive treatment (physical therapy) or a more aggressive treatment (surgery). In either case, patients are skeptical of a surgeon's motivation, and they are less likely to accept a treatment the more it is prescribed over concerns that a commonly prescribed treatment is in the surgeon's financial interest. Suppose that if a surgeon were to only prescribe physical therapy patients would accept the treatment 22% of the time, but patients would accept the treatment 65% of the time if the surgeon had never before prescribed physical therapy. Likewise, patients accept the recommendation of surgery 5% of the time if the physician always recommends surgery, but 90% of the time if the physician never recommends surgery. Finally, assume that the percentage of patients who accept a treatment declines linearly with the amount a treatment is prescribed. a) Using the same graph, plot the percentage of patients who accept the treatment as a function of the proportion of physical therapy recommendations, T. b) Write down the equations for the percentage of patients who accept treatment for each recommendation as a function of the proportion of physical therapy recommendations, T. c) What is an orthopedic surgeon's optimal proportion of physical therapy and surgery recommendations? d) Suppose that a group of public health students make a recommendation for which treatment orthopedic surgeons should recommend more of in order to increase patient compliance. If their recommendation is based on the observation of acceptance rates for each type of treatment, will their recommendation be correct? Explain. Orthopedic surgeons can make two different treatment recommendations for chronic knee pain: a less aggressive treatment (physical therapy) or a more aggressive treatment (surgery). In either case, patients are skeptical of a surgeon's motivation, and they are less likely to accept a treatment the more it is prescribed over concerns that a commonly prescribed treatment is in the surgeon's financial interest. Suppose that if a surgeon were to only prescribe physical therapy patients would accept the treatment 22% of the time, but patients would accept the treatment 65% of the time if the surgeon had never before prescribed physical therapy. Likewise, patients accept the recommendation of surgery 5% of the time if the physician always recommends surgery, but 90% of the time if the physician never recommends surgery. Finally, assume that the percentage of patients who accept a treatment declines linearly with the amount a treatment is prescribed. a) Using the same graph, plot the percentage of patients who accept the treatment as a function of the proportion of physical therapy recommendations, T. b) Write down the equations for the percentage of patients who accept treatment for each recommendation as a function of the proportion of physical therapy recommendations, T. c) What is an orthopedic surgeon's optimal proportion of physical therapy and surgery recommendations? d) Suppose that a group of public health students make a recommendation for which treatment orthopedic surgeons should recommend more of in order to increase patient compliance. If their recommendation is based on the observation of acceptance rates for each type of treatment, will their recommendation be correct? Explain.

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