What is the firms wacc

Assignment Help Financial Management
Reference no: EM131915461

XYZ, inc. operates in a country whose risk-free rate is 2.45%. The expected return of the market in the country is 8.20 % and The company has a beta of 1.06. The company has a $10M Bank loan with an interest rate of 7% and a $12M line of credit at 14%. The total equity of the company is valued at $15M. The company’s corporate tax rate is 35%. What is the firms WACC?

Reference no: EM131915461

Questions Cloud

Uses proceeds to repurchase shares : If the tax rate is 35 percent, what is the value of the firm? What will the value be if the company borrows $108,000 and uses the proceeds to repurchase shares?
Briefly discuss istanbul stock market : How does staging of new venture investments create value for the entrepreneur? What about for the investor. Briefly discuss the Istanbul Stock Market.
Write an essay about the growth of racism and slavery in us : Write an essay about the growth of racism and slavery in the United States during the 17th century. What was the outcome of the case/issue?
Identify the specific experimental research design : Identify the specific experimental research design used in the study. Summarize the main points of the experimental research study including information.
What is the firms wacc : The total equity of the company is valued at $15M. The company’s corporate tax rate is 35%. What is the firms WACC?
Asset that provides you lowest portfolio risk : You are a portfolio investor and, for simplicity, are investing in only two assets. You are to choose the asset that provides you the lowest portfolio risk.
How is success determined in service programs : How is success determined in service programs that must be subsidized, and how does it differ between governmental organizations and nonprofit organizations
What role does genetics play in human behaviors : What role does genetics play in human behaviors? Are criminals "just born that way" or does their environment contribute?
What scenario would want to use edd instead of cr : Assume that lead-time is strictly followed, and you are not able to get or build material inside of lead-time.

Reviews

Write a Review

Financial Management Questions & Answers

  Future value of annuity but not future value of perpetuity

Why can you compute the future value of an annuity but not the future value of perpetuity?

  Project is expected to create operating cash flows

A project is expected to create operating cash flows of $22,500 a year for three years. The initial cost of the fixed assets is $50,000. These assets will be worthless at the end of the project. An additional $3,000 of net working capital will be req..

  Balance of the savings account as down payment

An investor wants to save for five years for a down payment on a house. She deposits $200 per month into a savings account paying 7% compounded monthly. At the end of the five years, she places the balance of the savings account as a down payment on ..

  Compounded semiannually be worth if left in the bank

What will a deposit of $7,500 at 12% compounded semiannually be worth if left in the bank for six years?

  Cash flows shown in the chart if appropriate cost of capital

Proficient-level: Compute the NPV statistic for Project Y and tell [advise] whether the firm should accept or reject the project with the cash flows shown in the chart if the appropriate cost of capital is 12 percent.

  Prepare the plant assets section of balance sheet

At December 31, 2014, Navaro Corporation reported the following plant assets. Record adjusting entries for depreciation for 2015. Prepare the plant assets section of Navaro’s balance sheet at December 31, 2015.

  Use the free cash flow valuation model

Use the free cash flow valuation model to estimate CoolTech’s common stock value per share.

  Job security and low risk-return of their money and interst

Job security-Low risk, return of their money and interest- High prices-High Salary-Dividends or stock appreciation-Low prices

  What are the total costs

Annual demand 160,906 units Carrying costs $3.19 per unit Fixed Costs per order $5.6 Number of orders 48 What are the total costs?

  Continually receiving capital funding requests

The CFO of Edward's Food Distributors is continually receiving capital funding requests from its division managers. These requests are seeking funding for positive net present value projects. The CFO continues to deny all funding requests due to the ..

  Invest in using actual funds and quoted prices

Imagine that you have just inherited $40,000 from your grandfather and you have decided to invest it in a mutual fund portfolio. Identify the mutual funds you will invest in using actual funds and quoted prices. Consider utilizing a family of funds t..

  What is the beta of the stock

Cache Creek Manufacturing Company is expected to pay a dividend of $3 in the upcoming year. Dividends are expected to grow at the rate of 6% per year. The risk-free rate of return is 4%, and the expected return on the market portfolio is 10%. The sto..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd