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Medical Research Corporation is expanding its research and production capacity to introduce a new line of products. Current plans call for the expenditure of $100 million on four projects of equal size ($25 million each), but different returns. Project A is in blood clotting proteins and has an expected return of 18 percent. Project B relates to a hepatitis vaccine and carries a potential return of 14 percent. Project C, dealing with a cardiovascular compound, is expected to earn 11.8 percent, and Project D, an investment in orthopedic implants, is expected to show a 10.9 percent return.The firm has $15 million in retained earnings. After a capital structure with $15 million in retained earnings is reached ( in which retained earnings represent 60% of the financing), all additional equity financing must come in the form of new common stock.Common stock is selling for $25 per share and underwriting costs are estimated at $3 if new shares are issued. Dividends for the next year will be $.90 per share. and earnings and dividends have grown consistently at 11 percent per year. The yield on comparative bonds has been hovering at 11 percent. The investment banker feels that the first $20 million of bonds could be sold to yield 11 percent while additional debt might require a 2 percent premium and be sold to yield 13 percent. The corporate tax rate is 30 percent. Debt represents 40 percent of the capital structure. a. Based on the two sources of financing, what is the initial weighted average cost of capital?b. At what size capital structure will the firm run out of retained earnings?c. What will the marginal cost of capital be immediately after that point?d. At what size capital structure will there be a change in the cost of debt?e. What will the marginal cost of capital be immediately after that point?f. Based on the information about potential returns on investments in the first paragraph and information on marginal cost of capital (in parts a, c, & e), how large a capital investment budget should the firm use?g. graph the answer determined in part f.
Cost performance index, schedule variance, schedule performance index, estimate to complete (ETC) and estimate at completion (EAC)
Here is the link of the document: PLease click on Sustainable Development Report which is the 3rd document only on the bottom right hand side (50 pages).http://www.loreal-finance.com/eng/annual-report By relying on the 2013 Sustainable Development Re..
Describe the various methods of forecasting to develop an aggregate forecast and describe which type of forecasting method the company should use and why.
Let's look two of Able Company's two major competitors: Smith & White Company, a very large and aggressive domestic producer, and Makatume, a Japanese powerhouse.
Explain how does the economist’s use the term “rent” differ from everyday usage? Explain: “Through rent need not be paid by society to make land available, rental payments are very useful in guiding land into the most productive uses.”
question related to teamwork collaboration and conflict resolution1. examine an instance when you were in a meeting
Deliberate the pros and cons of free trade allowing for the perspectives of both more and less developed countries. Do you consider the benefits of free trade outweigh the drawbacks? Describe why or why not
forward rates given, calculate the one,two,three and four year spot rates.
Sales for 2010 were $350 million and net income for the year was $10.5 million, so the firm's profit margin was 3.0%. Upton paid dividends of $4.2 million to common stockholders, so its payout ratio was 40%. Its tax rate is 40%, and it operated..
For this question suppose that all 1124 of units of Baker are sold in the Nano segment. If the competitive environment remains unchanged illustrate what will be the Baker product’s demand next year (in 000’s)?
trade-offs in different approaches to job designwhat are the trade-offs between the different approaches to job design?
HR functions contribute to Effective Organizations - Explain what are some HR functions that contribute to creating a high performance organization?
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