You need to choose between making a public offering and arranging a private placement. In each case the issue involves $9.3 million face value of 10-year debt. You have the following data for each: • A public issue: The interest rate on the debt would be 8.15%, and the debt would be issued at face value. The underwriting spread would be 1.67%, and other expenses would be $73,000. • A private placement: The interest rate on the private placement would be 8.3%, but the total issuing expenses would be only $23,000. a-1. Calculate the net proceeds from public issue. (Enter your answer in nearest dollars not in millions.)

a-2. Calculate the net proceeds from private placement. (Enter your answer in nearest dollars not in millions.)

b-1. Calculate the PV of extra interest on private placement. (Enter your answer in dollars not in millions. Round your answer to 2 decimal places.)

What is the expected return of the second stock : Cameron has a two-asset portfolio with an expected return of 13.80%. The weight of the two stocks is 30% and 70%. The first stock has an expected return of 17%, what is the expected return of the second stock? |

Why is inventory excluded from the quick ratio : Why is inventory excluded from the Quick Ratio? |

What is the expected return e of the portfolio : Assume you have the following three-asset portfolio with the following characteristics: What is percentage of your portfolio is invested in Stocks A, B, and C respectively? What is the expected return E(Rp) of the portfolio? |

Firm did not pay a dividend as all profits were reinvested : Rick invested in Buffalo Wild Wings (BWLD) last year when the stock was $171.36. Over the year, the firm did not pay a dividend as all profits were reinvested in the company. The current share price of BWLD is $186.74. What was Rick’s capital gain yi.. |

Between making public offering-arranging private placement : You need to choose between making a public offering and arranging a private placement. In each case the issue involves $9.3 million face value of 10-year debt. You have the following data for each: • A public issue: The interest rate on the debt woul.. |

What is her compound average return : Paula decides to sell the 500 shares of Microsoft, Inc (MSFT) that she bought 7 years ago for $38.50. If the current price is $41.02, what is her compound (geometric) average return? |

Reflected in the required return of the bonds : Tom Cruise Lines Inc. issued bonds five years ago at $1,000 per bond. These bonds had a 20-year life when issued and the annual interest payment was then 13 percent. Real rate of return 3 % Inflation premium 5 Risk premium 5 Total return 13 % Assume .. |

Assume that the average cost per case drops : Start with the original assumptions. Notice that managed care plan #1 receives a much lower price in return for sending a larger volume of patients. Assume that the average cost per case drops to $90 due to the economies of scale. All other assumptio.. |

Corporate bonds and treasury bonds of similar maturities : The credit spread is the difference in YTM between corporate bonds and Treasury bonds of similar maturities. Explain why the credit spread correlates closely with stock volatility across time? |

## Practices will reduce a firms collection floatWhich of the following practices will reduce a firm's collection float? |

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## Requires initial fixed asset investmentQuad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.58 million. The fixed asset falls into the three-year MACRS class. The project is estimated to generate $2,040,000 in annual sale.. |

## Determinants of interest rate for individual securitiesDeterminants of Interest Rate for Individual Securities A particular security's default risk premium is 3.50 percent. For all securities, the inflation risk premium is 2.25 percent and the real interest rate is 3.00 percent. The security's liquidity .. |

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