Customer Service Chat
Get quote & make Payment
Assignment on cost of capital, finance, Other Engineering
Atlas Inc. is planning to invest in a 4-year project which has the same risk as
the firm’s existing assets and operations. The project requires a $150,000 initial investment and is expected to generate equal annual after-tax cash flows for the next 4 years. In consultation with investment bankers, Atlas expects to be able to issue new debt at par with a coupon rate of10% and to issue new preferred stock with a $3 per share dividend at $30 a share. The common stock of the company is currently selling for $25.00 a share. Atlas Inc. expects to pay a dividend of $1 per share next year. Market analysts foresee a growth in dividends in Atlas stock at a rate of 10% per year. Atlas’s marginal tax rate is 30%. If Atlas raises capital using 45% debt, 5% preferred stock, and 50% common stock, what is its cost of capital? If Atlas’s beta is 1.2, market risk premium is 7.5%, and the risk free rate is 5.0%, compute the discount rate the firm should use to evaluate this project? What is the minimum cash flow per year this project should generate over the next four years to be accepted by the company?
Posted Date: 2/5/2012 1:08:18 PM | Location : United States
Ask an Expert
Assignment on cost of capital, finance, Assignment Help, Ask Question on Assignment on cost of capital, finance, Get Answer, Expert's Help, Assignment on cost of capital, finance Discussions
Write discussion on Assignment on cost of capital, finance
Your posts are moderated
Write your message here..
Friction welding techniques, Q. Explain briefly the Friction welding techni...
Q. Explain briefly the Friction welding techniques. OR Discuss any two solid state welding methods.
Friction damage, awareness on abrasion
awareness on abrasion
Measurement of thermocouple voltage, Measurement of thermocouple voltage ...
Measurement of thermocouple voltage The voltage is typically only a few millivolts and should be measured using a high impedance system. If an amplifier is used, must also have
Grain ethanol plant design, Can you help me design a grain ethanol plant as...
Can you help me design a grain ethanol plant as a design project? I need help with mass and energy balances Key equipment design ie distillation column, heat exchanger, storage t
LTE, WHATIS LTE CODING TECHNIQUES USE FOR MOBILE SYSTEM
WHATIS LTE CODING TECHNIQUES USE FOR MOBILE SYSTEM
Principles of fire alarm systems, Principles of Fire Alarm Systems: Fi...
Principles of Fire Alarm Systems: Fire alarm systems usually perform two primary functions. Firstly, they provide a means for warning people throughout the building that the
Fins vs canards , Fins vs Canards Canard control - Good lift/latax co...
Fins vs Canards Canard control - Good lift/latax control for moderate angles of attack. - Shed vortices can interfere with tail to generate roll moment. - Tendency to stall
In-plane shear tests for composite materials , The ideal test should provid...
The ideal test should provide a region of pure, uniform shear stress within the test sample. The most simple test is the tension test on the (+/-45°)ns sample, where n is greater
Time motion study, how to create a chart of time motion study
how to create a chart of time motion study
Steamtables, How to draw diagrams for Rankine cycle
How to draw diagrams for Rankine cycle
Accounting Assignment Help
Economics Assignment Help
Finance Assignment Help
Statistics Assignment Help
Physics Assignment Help
Chemistry Assignment Help
Math Assignment Help
Biology Assignment Help
English Assignment Help
Management Assignment Help
Engineering Assignment Help
Programming Assignment Help
Computer Science Assignment Help
IT Courses and Help
Why Us ?
~24x7 hrs Support
~Quality of Work
~Time on Delivery
~Privacy of Work
Human Resource Management
Literature Review Writing Help
Follow Us |
T & C
Copyright by ExpertsMind IT Educational Pvt. Ltd.