Results of a financial planning model indicate

Assignment Help Financial Management
Reference no: EM13946930

A firm's goal is to maintain a 75% debt-equity ratio. How much equity would be required if the results of a financial planning model indicate that the firm's assets will grow to $4 million?

A. $1.00 million

B. $1.71 million

C. $2.29 million

D. $3.00 million

Reference no: EM13946930

Questions Cloud

How much should you invest in the risk-free asset : You want your portfolio beta to be 0.90. Currently, your portfolio consists of $4,000 invested in stock A with a beta of 1.47 and $3,000 in stock B with a beta of 0.54. You have another $9,000 to invest and want to divide it between an asset with a b..
Consider the prevailing conditions : Consider the prevailing conditions that could affect the demand for stocks, including inflation, the economy, the budget deficit, national debt, and the Fed’s monetary policy, political conditions, and the general mood of investors. Based on these pr..
What would risk-free rate-two stocks to be correctly priced : Stock Y has a beta of 1.0 and an expected return of 13.5 percent. Stock Z has a beta of .6 and an expected return of 9 percent. What would the risk-free rate have to be for the two stocks to be correctly priced?
Car payment is interest expense : You borrow $78,000 to purchase a new car. The dealership offers you a 7% APR for 5 years. how much of your first car payment is interest expense? Explain how you found your answer.
Results of a financial planning model indicate : A firm's goal is to maintain a 75% debt-equity ratio. How much equity would be required if the results of a financial planning model indicate that the firm's assets will grow to $4 million?
Geometric average return for the period : A stock has annual returns of 5.4 percent, 12.9 percent, -3.8 percent, and 9.4 percent for the past four years. The arithmetic average of these returns is _____ percent while the geometric average return for the period is _____ percent.
What would her percentage return be in load fund return case : Alex invested $9,530 in a mutual fund at a time when the price per share was $10. The fund has a load fee of $50. How many shares did she purchase? Alex later sells her shares in the mutual fund for $12 per share. What would her percentage return be ..
Retaining a debt-equity ratio : If the pro forma balance sheet shows that total assets must increase by $400,000 while retaining a debt-equity ratio of .75 then:
What is the expense ratio for mutual fund : Avery owns a mutual fund with a NAV of $38.00 per share and expenses of $1.50 per share. What is the expense ratio for Avery's mutual fund? Jo purchased 375 shares of a no-load stock mutual fund. During the year she received $3 per share in dividend ..

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the after-tax cash flow

Calculate the After-Tax Cash Flow, NPV (at minimum ROR=20%) and ROR for the following investment: The investor is a Non-integrated petroleum company. Total producible oil in the reserve is estimated to be 2,400,000 barrel

  What must the coupon rate be on the companys bonds

Ghost Rider Corporation has bonds on the market with 10 years to maturity, a YTM of 6.5 percent, and a current price of $926. What must the coupon rate be on the company’s bonds? (Do not round intermediate calculations. Enter your answer as a percent..

  1 suppose that there are two calls on the same stock one

1. suppose that there are two calls on the same stock one with exercise price k of 30 the other 35. the market value

  Price of put option necessary to guarantee your sales price

You own a lot in Key West, Florida, that is currently unused. Similar lots have recently sold for $1,370,000. Over the past five years, the price of land in the area has increased 5 percent per year, with an annual standard deviation of 28 percent. W..

  Forecasting interest rates based on prevailing conditions

discuss the impact of each of the factors on your opinion. Offer some logic or current reference(s) to support your answer. Which factor do you think will have the biggest impact on interest rates?

  Chase strategy-how many employees would be needed

The expected demand in October is 20,000 units, and there are 25 working days in October. The production rate is 10 units per day per employee. The initial inventory is 1,000 units, and the ending inventory target is 5,000 units. Following a chase st..

  Primary operating goal of a publicly-owned firm interested

The primary operating goal of a publicly-owned firm interested in serving its stockholders should be to

  About the expected return-risk-free rate

Stock Y has a beta of 1.01 and an expected return of 8.38 percent. Stock Z has a beta of .70 and an expected return of 7 percent. What would the risk-free rate have to be for the two stocks to be correctly priced relative to each other?

  What is jakes weighted average cost of capital

Team B Jake's Sound Systems has 390,000 shares of common stock outstanding at a market price of $31 a share. Its beta is 0.8. Market expected return is 13% and risk-free rate is 6%. Jake's also has 7,700 bonds outstanding with a face value of $1,000 ..

  Explain straight-line depreciation

The new copier will allow FA to increase revenues by $2,000 each year but expenses will also increase by $500 each year. Account receivables will increase by $500 and account payables will increase by $800 if the copier is purchased.

  What is dollar cost averaging

What is dollar cost averaging? If you were an astute investor at timing market moves, would you want to use dollar cost averaging?

  Expected return on the market portfolio

Currently the risk-free rate is 6% and the expected return on the market portfolio is 11%, the expected return for 3 stocks as priced in the market are listed below with their estimate of beta.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd