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Problem Weight of Equity
FarCry Industries, a maker of telecommunications equipment, has 3 million shares of common stock outstanding, 1 million shares of preferred stock outstanding, and 10,000 bonds. Suppose the common shares are selling for $29 per share, the preferred shares are selling for $15.50 per share, and the bonds are selling for 98 percent of par. What would be the weight used for equity in the computation of FarCry’s WACC?
Weight used = %
Problem Weight of Debt
OMG Inc. has 4 million shares of common stock outstanding, 3 million shares of preferred stock outstanding, and 5,000 bonds. Suppose the common shares are selling for $28 per share, the preferred shares are selling for $27 per share, and the bonds are selling for 108 percent of par.
What weight should you use for debt in the computation of OMG’s WACC?
A pension plan is obligated to make disbursements of $2.2 million, $3.2 million, and $2.2 million at the end of each of the next three years, respectively.
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You bought one of Great White Shark Repellant Co.’s 8.2 percent coupon bonds one year ago for $1,050. These bonds make annual payments and mature 13 years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is..
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Uriah Heep celebrated his 18th birthday by opening a savings account at the Thames River Bank and depositing $ 1900 . He continued to deposit the same amount on every subsequent birthday until he was 28 years old. What was the amount of his withdrawa..
What was the price you purchased the stocks at six months ago, if there is no dividend involved?
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