Information compute cost of capital

Assignment Help Operation Management

Reference no: EM13819219

Based on the following information compute cost of capital

Assets 450000, Liabilities are 40% of total capital, Company tax rate is 35%, pre tax cost of debt is 12%.New equity capital (common stock) can be raised if investors yield is 18% .Retained earnings are expected to return 20% to statisfy corporate growth objectives .Common stock and Retained earnings are each half of the remaining capital structure.

Reference no: EM13819219

Questions Cloud

Strategic options for competing internationally : There are three strategic options for competing internationally: multi-country, global, and hybrid. Assume you are in charge of developing a strategy for a multi-national company selling products in some 50 countries around the world. One of the issu..

What makes a good code of conduct within an organization : What makes a good code of conduct within an organization? Bring in a few examples of companies that have good Codes of Conduct. What can a company do to ensure the general public has a good perception of it?

What value of alpha and the smoothing constant : A company has had actual unit demand for four consecutive years of 100, 110, 125 and 150. The respective forecasts using exponential smoothing were 120 for each of those four years. What value of alpha, the smoothing constant, was the firm using?

All perceptions are subjective : We know that all perceptions are subjective and there is not necessarily a best way to understand any given situation. So, if there are so many moving parts to perception, how do you make sure your own perceptions are accurate? In your answer give ex..

Information compute cost of capital : Assets 450000, Liabilities are 40% of total capital, Company tax rate is 35%, pre tax cost of debt is 12%.New equity capital (common stock) can be raised if investors yield is 18% .Retained earnings are expected to return 20% to statisfy corporate gr..

Describe an ethical dilemma : Describe an ethical dilemma you have encountered in your own life. Provide enough information so we can understand your situation, but please change details to protect the innocent (or the guilty). Why did the situation present a dilemma for you? How..

American-quality toast vs. japanese-quality toast : Describe how the analogy that Deming uses describing “American-quality toast vs. Japanese-quality toast” fits into his philosophy of management?

Airlines operate networks or hub-and-spoke systems : Most large airlines operate networks, or hub-and-spoke systems, which connect many spoke cities (or nodes) with flights to and from a hub airport. How can a network airline profitably serve smaller cities than a low-cost-airline

Specializes in voice recognition software : Voice App is a midsize software company that specializes in voice recognition software. Due to rising costs of maintaining IT technical support, your director is considering outsourcing your technical support services.

User Account

All Pages