For a company whose target capital structure calls for 50% debt and 50% common equity, which of the following statements is CORRECT? The interest rate used to calculate the WACC is the average aftertax cost of all the company’s outstanding debt as s..

Garage, Inc., has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 –$ 28,900 –$ 28,900 1 14,300 4,250 2 12,200 9,750 3 9,150 15,100 4 5,050 16,700 a1 What is the IRR for each of these projects? At what dis..

Weston Mines has a cost of equity of 20.8 percent, a pretax cost of debt of 9.4 percent and a return on assets of 17.1 percent. Ignore taxes. What is the debtequity ratio?

On a particular day, the campus bookstore sold 30 Tshirts. White ones cost $9.95 and yellow ones cost $10.50. Total sales of Tshits were $310.60. How many white shirts were sold? If working alone, Marcus can paint a room in 3.15 hours. Working toge..

A company is considering a 5year project to open a new product line. A new machine with an installed cost of $110,000 would be required to manufacture their new product, which is estimated to produce sales of $60,000 in new revenues each year. If st..

Calculate Company B’s weighted average cost of equity, given the following information: (a) Dividend: $2.50, (b) Growth Rate: 5.2% (c) Price: $35.20, (d) Debt: $33,000,000, (e) Equity: $24,000,000, and (f) Preferred Stock: $5,000,000.

The YTM on a bond is the interest rate you earn on your investment if interest rates don’t change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY).

weighted average cost of capital evaluate 2012 financial statements and other financial data example beta for

Suppose you decide to invest in corporate bonds. Accordingly, you visit a bond store. You see 3 bonds on the shelf. One is priced at $1,015.53, another is priced to sell at $1,300.00, and a third is selling at a discounted amount of $876.06. But you ..

What is the present value of $1,500 received for 24 months in arrears, followed by $1,200 received for 36 months in arrears, if the annual discount rate appropriate is 9.25%?


A new employee charged $5140 on his credit card to relocate for his first job. After noticing that the interest rate for his balance was 24% compounded monthly, he stopped charging on that account. What monthly payment must he make to pay off the acc..
