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Calculate the wacc for PG given the following: the company has outstanding debt that matures in 20 years that has a coupon of 9%. It pays interest semi-annually and the bon% premium to par is 1214.59. For a reference 20 year treasuries are yielding 3.5%. PG has outstanding preferred coupon, par value and is currently priced at $120. If new preferred was issued the company would incur flotation costs of 5%. The company's stock is currently priced at $100 and the current dividend is $3.00.That dividend is expected to grow at 3% forever. The beta of PG is 0.6 and the RFR and MRP are 3% and 7% respectively. Ignore flotation costs for your cost of equity.
The target structure is 60% equity, 30% debt and 10% preferred. The tax rate is 40%.
If the company had no residual cash and new issued equity would incur a flotation cost of 10%.Calculate a new the WACC using only the DCF method for equity and keeping all other factors the same. Comment on your findings
A project has an initial cost of $8,900 and produces cash inflows of $2,700, $5,100, and $1,700 over the next three years, respectively. What is the discounted payback period if the required rate of return is 7 percent?
The real risk-free rate is expected to remain at 3 percent. Inflation is expected to be 3 percent this year, and 4 percent next year. The maturity risk premium is estimated to be equal to 0.1%(t - 1), where t = the maturity of a bond (in years).
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Explain how your topic is used in global financing operations and describe its importance in managing risks.
In 350-400 words explain why investors expect a higher rate of return from stocks with a variable return rate. Include once source reference.
Landmark Coal operates a mine. During July, the company obtained 500 tons of ore, which yielded 250 pounds of gold and 62,500 pounds of copper. The joint cost related to the operation was $500,000. Gold sells for $325 per ounce and copper sells for $..
When originally issued, the bonds were sold for $960 per bond; today their current market price is $1,065 per bond and company pays a semi-annual interest of $45 per bond. If an investor purchases a bond 10 years ago when the bond was first issued an..
hedging using foreign currency derivatives scout finch is the chief financial officer cfo of salem manufacturing a u.s.
During recent years your company has made considerable use of debt ?nancing, to the extent that it is generally agreed that the percent debt in the ?rm's capital structure is too high.
dr. n. mohamudally 12.00 question 1 normal 0 false false false en-in x-none x-none
Li-Jen borrows $36000 for a home improvement project loan from the bank woth a 60 month fixed rate financing at an annual interest of 5.7% compounded monthly. what is the amount of her monthly loan payment to amortize the loan?
The book value of the shareholders' ownership is represented by:
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