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Norman Internet Service Company (NISC) is interested in selling common stock to raise capital for capacity expansion. The firm has consulted First Tulsa Company, a large underwriting firm, which believes that the stock can be sold for $50 per share.
The underwriter's investigation found that its administrative costs will be 2.5 percent of the sale price, and its selling costs will be 2.0 percent of the sale price.
If the underwriter requires a profit, equal to 1 percent of the sale price, how much, in dollars, will the spread have to be to cover the underwriter's costs and profit?
An unlevered firm has a perpetual EBIT = $1500. The current value of the firm is Vu = $1500. The share count of the firm is N0 = 1000. The firm considers repurchasing its shares by issuing debt. What is the value of the firm after the recap? How many..
How does net working capital affect the NPV of a 5-year project if working capital is expected to increase by $30,000 and the firm has a 16% cost of capital?
Free cash flow valuation Nabor Industries is considering going public but is unsure of a fair offering price for the company. Estimate the value of Nabor Industries' entire company by using the free cash flow valuation model. Use your finding in part..
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$100,000, 182-day Province of New Brunswick Treasury bill was issued 66 days ago. - What will it sell at today to yield the purchaser 4.48%?
A bond with a coupon rate of 8% makes semiannual coupon payments on January 15 and July 15 of each year. The ask price for the bond on January 30 is at 100:08. What is the Invoice Price of the bond? The coupon period has 182 days
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On 1 of January 2013 ABC Company announced Stock options for the CFO at the price of $25 a share - 1000 shares. The exercise time is from January 2013 till January 2015. These are NSO and he buys them on March 2014 when the marker price is $30 a shar..
Seven years ago, you cut costs for employee health insurance by switching from open-ended insurance to health maintenance organizations (HMOs). At that time, you kept open-ended insurance for retirees because your employees told you that retirees wan..
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