james PLC one of the companies listed on the stock exchange wishes to calculate its updated weighted Average cost of capital for use in the investment appraisal process.

$'

Million

Issued shared capital ($100 shares 2,000

Share premium 1,300

Reserves 145

Share Holders funds 3,445

6% irredeemable Debentures 1,400

9% Redeemable Debentures 1,450

Bank loan 500

Total Long - Term liabilities 3,350

The current cumulative interest market value per $100 units is $103 and $105 for the 6% and 9% debentures respectively. The 9% denture is redeemable at par in 10 years' time. The bank loan bears interest rate of 2% above the base rate (current base rate is 15%). The current ex-div market price of shares is $1,100 and a divided of $100 per share which is expected to grow at a rate of 5% per year has just been paid. The effective corporation tax rate for James PLC is 30%.

Required

(a) Calculate the effective after tax Weighted Average cost of Capital (WACC) for James PLC.

(b) Using the traditional theory of capital structure explain what would happen if the company took on additional debt finance.

Dingel Inc. is attempting to evaluate three alternative capital structures - A,B,C. The following table shows the three structures along with relevant cost data. The firm is subject to a 40% tax rate. The risk-free rate is 5.3% and the market return is currently 10.7%

(a) Calculate the after-tax cost of debt for each capital structure

(b) Calculate the cost of preferred stock for each capital structure

(c) Calculate the cost of common stock for each capital structure

(d) Calculcate the weighted average cost of capital (WACC) for each capital structure

(e) compare the WACCs calculated in part (d) and discuss the impact of the firm's financial leverage on its WACC and its related risk

Please include detail of work

1. A perfectly competitive industry faces a demand curve given by Q^D= 2515 – 2P. The long-run total cost curve of each firm is given by LTC = 10q -.2q²+.004q³. Derive the long-run equilibrium values of output per firm, market output, price, and the number of firms.
2. You are told that in long-run perfectly competitive equilibrium each firm produces 25 units and that the marginal cost at that level of output is $10. Solve for the long-run equilibrium values of market output, price, and the number of firms. The market demand is given by Q^D= 4000 – 10P.
3. Assume the world market for calcium is perfectly competitive and that all existing producers and potential entrants are identical. Consider the following information about the price of calcium. Between 1990 and 1995, the market price was stable at $2/pound. In the first three months of 1996, the market price doubled reaching $4/pound, where it stayed for the remainder of 1996. Throughout 1997 and 1998, the price declined, eventually reaching $2/pound by the end of 1998. Between 1998 and 2002, the price remained stable at $2/pound. Assume that technology has not changed and that input prices have remained constant over the period. Using words, explain this pricing pattern over the period.

Powerball. In this assignment you are to code a program that selects 20 random non-repeating positive numbers (the Powerball Lottery numbers), inputs three numbers from the user and checks the input with the twenty lottery numbers. The lottery numbers range from 1 to 100. The user wins if at least one input number matches the lottery numbers.

As you program your project, demonstrate to the lab instructor displaying an array passed to a function. Create a project titled Lab6_Powerball. Declare an array wins of 20 integer elements.

Define the following functions:

• Define function assign() that takes array wins[] as a parameter and assigns 0 to each element of the array.

  Hint: Array elements are assigned 0, which is outside of lottery numbers' range, to distinguish elements that have not been given lottery numbers yet.

  Passing an array as a parameter and its initialization is done similar to the code in this program.

  • #include <iostream>
    using std::cout; using std::endl; using std::cin;
    
    // initializes the array by user input
    void fillUp(int [], int);
    
    int main( ) {
       const int arraySize=5;
       int a[arraySize];
    
       fillUp(a, arraySize);
    
       cout << "Echoing array:\n";
       for (int i = 0; i < arraySize; ++i)
          cout << a[i] << endl;
    }
    
    // fills upt the array "a" of "size"
    void fillUp(int b[], int size) {
    
       cout << "Enter " << size << " numbers: ";
       for (int i = 0; i < size; ++i)
          cin >> b[i];
    }

• Define a predicate function check() that takes a number and the array wins[] as parameters and returns true if the number matches one of the elements in the array, or false if none of the elements do. That is, in the function, you should write the code that iterates over the array looking for the number passed as the parameter. You may assume that the number that check() is looking for is always positive.

  Hint: Looking for the match is similar to looking for the minimum number in this program.

  • #include <iostream>
    using std::cout; using std::endl; using std::cin;
    
    int main(){
    
       const int arraySize=5;
       int numbers[arraySize];  // array of numbers
    
       // entering the numbers
       cout << "Enter the numbers: ";
       for(int i=0; i < arraySize; ++i)
            cin >> numbers[i];
    
      // finding the minimum
      int minimum=numbers[0]; // assume minimum to be the first element
      for (int i=1; i < arraySize; ++i) // start evaluating from second
            if (minimum > numbers[i]) 
               minimum=numbers[i];
      
      cout << "The smallest number is: " << minimum << endl;
    
    }
    

• Define a function draw() that takes array wins as a parameter and fills it with 20 random integers whose values are from 1 to 100. The numbers should not repeat.

  Hint: Use srand(), rand() and time() functions that we studied earlier to generate appropriate random numbers from 1 to 100 and fill the array. Before the selected number is entered into the array wins, call function check() to make sure that the new number is not already in the array. If it is already there, select another number.

  The pseudocode for your draw() function may be as follows:

      declare a variable "number of selected lottery numbers so far",
                   initialize this variable to zero
      while (the_number_of_selected_elements is less than the array size)
           select a new random number
           call check() to see if this new random number is already in the array
           if the new random number is not in the array
               increment the number of selected elements
               add the newly selected element to the array
  
     

• Define function entry() that asks the user to enter a single number from 1 to 100 and returns this value.
• Define function printOut() that outputs the selected numbers and user input.
  Hint: Outputting the array can be done similar to echoing it in this program.

  • #include <iostream>
    using std::cout; using std::endl; using std::cin;
    
    // initializes the array by user input
    void fillUp(int [], int);
    
    int main( ) {
       const int arraySize=5;
       int a[arraySize];
    
       fillUp(a, arraySize);
    
       cout << "Echoing array:\n";
       for (int i = 0; i < arraySize; ++i)
          cout << a[i] << endl;
    }
    
    // fills upt the array "a" of "size"
    void fillUp(int b[], int size) {
    
       cout << "Enter " << size << " numbers: ";
       for (int i = 0; i < size; ++i)
          cin >> b[i];
    }
    

The pseudocode your function main() should be as follows:

  main(){
      declare array and other variables
  
      assign(...) // fill array with 0
      draw(...)       // select 20 non-repeating random numbers
      iterate three times
            entry(...)      // get user input
            use check () to compare user input against lottery numbers
            if won state and quit
      printOut(...)   // outputs selected lottery numbers
  }
  

Note: A program that processes each element of the array separately (i.e. accesses all 20 elements of the array for assignment or comparison outside a loop) is inefficient and will result in a poor grade.

Note 2: For your project, you should either pass the array size (20) to the functions as a parameter or use a global constant to store it. Hard-coding the literal constant 20 in function definitions that receive the array as a parameter is poor style. It should be avoided.

NPV & IRR:

Find the NPV (assume 8% just to calculate NPV initially) & IRR of these projects. When would you choose one over the other (i.e. what is the crossover rate)? Draw the NPV profile using 11 intervals of interest rates ranging from (and including) 0% to 100%. Place all data, ratios, calculations, findings, etc. in the first Excel sheet with references to the information in other sheets.

The tabulated data show the concentrations of N2O5 versus time for this reaction: N2O5 (g) --> NO3 (g) + NO2 (g).

1a. Determine the order of the reaction by graphing:

Zero Order: Time vs [N2O5]

First Order: Time vs ln[N2O5]

Second Order: Time vs 1/[N2O5]

1b. Determine the rate constant

1c. Predict the concentration of N2O5 at 250 seconds.

The tabulated data show the concentrations of N2O5 versus time for this reaction: N2O5 (g) --> NO3 (g) + NO2 (g).

1a. Determine the order of the reaction by graphing:

Zero Order: Time vs [N2O5]

First Order: Time vs ln[N2O5]

Second Order: Time vs 1/[N2O5]

1b. Determine the rate constant

1c. Predict the concentration of N2O5 at 250 seconds.

Managers conclude that the combination of two firms will expand revenues through cross selling of products, efficient exploitation of brands, and geographic and product line extension.

They forecast new revenues of $100 million in the first year and $200 million in year two, growing at 2.5% per year there after. The cost of goods underline these new revenues is 45% of the revenues.

To achieve these synergies will require an investment of $400 million initially, and 5% of the added revenue each year, to find working capital growth.

Find the net present value of the synergy is using a discount rate of 15% and a marginal tax rate of 40%

A company had stock outstanding as follows during each of its first three years of operations: 2,000 shares of 9%, $100 par, cumulative preferred stock and 36,000 shares of $10 par common stock. The amounts distributed as dividends are presented below. Determine the total and per-share dividends for each class of stock for each year by completing the schedule. Round dividends per share to the nearest cent. Enter "0" if no dividends are paid.