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The controller prefers Project S, but the CFO prefers Project L. How much value will the firm gain or lose if Project L is selected over Project S, i.e., what is the value of NPVL - NPVS?
The firm's cost of equity is 14.5 percent and its pre-tax cost of debt is 8.5 percent. The tax rate is 34 percent. What does the debt-equity ratio need to be for the firm to achieve its target WACC?
Last year Vaughn Corp. had sales of $315,000 and a net income of $17,832, and its year-end assets were $210,000. The firm's total-debt-to-total-assets ratio was 42.5%. Based on the Du Pont equation
At a corporate MARR of 10% per year, does the project Annual Worth indicate it will make at least the MARR?
If the average buyout package is $100,000 and the company is able to reduce costs by $20 million per year, what rate of return will the company make over a 10-year study period? Assume all the compa
You borrow $200,000 from the bank on a 20 year loan with a 10% APR compounded monthly. If the bank borrows money at 7% APR compounded monthly, what is the present worth of the loan on the day it's e
What is the convertible's straight bond's value? What is the implied value of the convertible feature?
The bonds mature in 6 years, have a face value of $1,000, and currently sell at 96 percent of par. (Christie's does not have a target capital structure, so the market values of the capital component
An all equity firm has net income of $27,300, depreciation of $7,400 and taxes of $2,050. what is the firms operating cash flow?
Describe and evaluate the following four investments for consideration in any investment portfolio: Bonds--corporate and municipal, Stocks--common and preferred, Mutual funds, & Derivatives.
what value should be included in the initial cost of the hotel project for the use of this land?
A project requires $336,000 of equipment that is classified as 7 year property. What is the depreciation expense in year 3 given the following MACRS depreciation allowance, starting with year one: 1
You are analyzing a project and have developed the following estimate. the depreciation is $19,800 a year and the tax rate is 34 percent. what is the best case operating cash flow?
One year ago, you purchased 400 shares of stock for $12 a share. the stock pays $0.22 a share in dividends each year. today, you sold your shares for $28.30 a share. what is your total dollar return
The fixed cost would only be $2100 a year and the tax rate is 34 percent. what is the annual operating cash flow if the annual depreciation expense is $900?
Midwest Bank also offers to lend you the $50,000, but it will charge an annual rate of 7.0%, with no interest due until the end of the year. How much higher or lower is the effective annual rate cha
A project for Jevon and Aaron, Inc. results in additional accounts receivable of $400,000, additional inventory of $180,000, and additional accounts payable of $70,000. What is the additional invest
Given an estimate of machine hours for the next year, the coating department' s projected cost per machine hour is computed. Here are data for the last three operating years. Expected coating machin
You purchased 1,000 shares of common stock on year ago for $60 per share. You received a dividend of $3 per share today and decided to take your profits by selling at $61.50 per share. What is your
You purchased 1,000 shares of Williams Inc. common stock one year ago for $60 per share. You received a dividend of $3 per share today and decide to take your profits by selling at $61.50 per share.
Based on the information below, please calculate the expected return and standard deviation of each of the following stocks. Assume each state of the economy is equally likely to happen. What are th
A stock has an expected return of 16.2%, a beta of 1.75 and the expected return on the market is 11%. what must the risk-free rate be?
What is the present value of the bond rounded to the nearest cent?
What will your annualized holding period return (HPR) on this investment be if you hold the bond for 6 years.
The Evanec Company's next expected dividend, D1, is $3.18; its growth rate is 6%, and its common stock now sells for $36.00. New stock (external equity) can be sold to net $32.40 per share.