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Assuming that sales, operating costs, assets, the interest rate, and the tax rate would all remain constant, by how much would the ROE change in response to the change in the capital structure?
Short-term investments = $200; Stockholders' equity = $1,800; Total debt = $700; and Total operating capital = $2,300. What was its return on invested capital (ROIC)?
calculate the present value of an ordinary annuity of $5000 received annually for 10 years, assuming a discount rate of 9%.
Consider a 6% coupon bond that matures in 20 years.What would be the value of this bond if interest rates fall to 5% the day after it is purchased? If interest rates fell to 5% after one year, what
Now assume that Bank Z makes a loan in the amount that can be safely lent against the funds deposited in its bank from the transaction described in (b). Show what Bank Z's balance sheet of assets an
Income statement report EBITDA $7.5 Million & $1.8 Million of net income. Interest Expense $2 million and 40% corp Tax. What is the depreciation and amortization expense?
Bond X is a premium bond making annual payments. The bond pays an 8 percent coupon, has a YTM of 6 percent, and has 13 years to maturity. Bond Y is a discount bond making annual payments.
AirJet Best Parts, Inc. would like to issue 20-year bonds to obtain remaining funds for the new Mexico plant. The company currently has 7.5% semiannual coupon bonds in the market that sell for $1,06
You want to buy a condo 5 years from now, and you plan to save $3,000 per year, beginning immediately. You will make 5 deposits in an account that pays 6% interest. How much will you have 5 years fr
Martell corporation's 2008 sales were $12 million. sales were $6 million five years earlier. to the nearest percentage point, at what rate have sales grown?
In regards to the INDITEX company: Calculate the cost of each capital component, after-tax cost of debt, cost of preferred, and cost of equity with the DCF method and CAPM method.
Assume the expected inflation rate to be 4 percent. If the current real rate of interest is 6 percent, what ought the nominal rate of interest be?
What is the difference between an internal economy of scale and an external economy of scale? Give examples as part of your answer.
How much higher or lower is the effective annual rate charged by Midwest versus the rate charged by Riverside?
Discuss how SSC's stockholders will view each of these actions, and how they will affect the stock price.
Suppose your stock portfolio's beta is 1.40 and it's currently valued at $1 million. The S&P 500 index is currently at 2,000. The riskfree rate is 4% per annum and the dividend yield on
What is AOL's enterprise value? What is AOL's enterprise value?
What is the optimal combination of risky assets that a risk-averse investor should hold? (Remember that there is also a risk-free asset available - no calculations, just describe)
2.High Flyer, Inc., wishes to maintain a growth rate of 17.75 percent per year and a debt-equity ratio of 1.25. The profit margin is 4.1 percent, and total asset turnover is constant at 1.01.
Discuss the various types of bonds and how they are used to raise funds by public and private institutions and why is each type of security used, and what are the risks and rewards associated with a
AirJet Best Parts, Inc. is concerned regarding recent changes in its stock prices for the company and would like to determine the stock prices for key competitors. Key competitors include Raytheon,
Sorenson Corp.'s expected year-end dividend is D1 = $1.60, its required return is rs = 11.00%, its dividend yield is 6.00%, and its growth rate is expected to be constant in the future. What is Sore
The required return on this low-risk stock is 9.00%. What is the best estimate of the stock's current market value?
A firm wishes to maintain an internal growth rate of 7% and a dividend payout ratio of 25%. The current profit margin is 5% and the firm uses no external financing sources. What must total asset tur
Final earnings estimates for Chilean Health Spa & Fitness Center have been prepared for the CFO of the company and are shown in the following table. The firm has 7,500,000 shares of common stock