1. True Green has a cost of equity of 12% and a pretax cost of debt of 6%. The debt-equity ratio is .40 and the tax rate is 35 percent. What is the unlevered cost of capital?
a. 12.36% b. 11.94% c.11.48% d. 11.02% e. 10.76%
2. You just returned from some extensive traveling. You started your trip with $10,000 in your pocket. You spent 1.32 million pesos in Chile where Ps1 = $.001642. You spent Ps36,000 in Uruguay where Ps1 = $.04247. Then on the way home, you spent Ps29,000 pesos in Mexico where $1 = Ps13.9334. How many dollars did you have left by the time you returned to the U.S.?
$4,222.31
$4,110.27
$3,889.07
$4,299.03
$4,001.84