1. XYZ corp is a private company without publicly
traded equity. you need to determine what XYZ's equity Beta would
be if the company decided to go public. XYZ target equity ratio is
75%. below are XYZ 3 closet competitors.
Alsace. Beta=1.44. debt
ratio=0.54
Parasol. Beta=1.12. debt
ratio=0.22
Univex. Beta=1.36. debt
ratio=0.42
what is XYZ expected equity beta?
2. assume that risk free rate of 1.55% and an equity market risk premium of 5.5%,what is XYZ equity cost of capital(re)? if you were unable to calculate XYZ in question 1,use a beta 1.21 for this calculation.
3. assume XYZ cost of debt is 200 basis points over the risk free rate,what is XYZ WACC? use tax rate of 25%. if you didn't calculate re in question 2 ,use 7.5 as XYZ equity capital.
4. what happens to XYZ WACC if tax rate increase to 35% . what generalization can you make about the relationship between corporate tax rate and company's WACC?
5. debt is cheaper that equity, so if XYZ changed its
target equity ratio from 75% to 65% would reduce XYZ's WACC? why or
why not? what happens to the cost of debt as leverage is
increase?how does leverage affect equity beta?
please try to answer all my questions. its very important.
In: Finance
Excavation Co., a publicly-traded company, has a December 31 year end. For the 2020 fiscal year, there were 100,000 common shares outstanding all year. Net income for the year ended December 31, 2020 was $900,000. The company’s income tax rate is 25%. During 2019, Spade issued a $5,000,000, 5% convertible bond at par. Each $1,000 bond is convertible into 20 common shares. No bonds have been converted as of December 31, 2020. Also during 2019, Spade issued 100,000, $2 cumulative, convertible preferred shares. Two preferred shares are convertible into one common share. The preferred share dividend was declared and paid in June, 2020. Required : Calculate basic and diluted earnings per share for 2020.
In: Accounting
Using the data in the following? table, and the fact that the correlation of A and B is 0.02?, calculate the volatility? (standard deviation) of a portfolio that is 80% invested in stock A and 20% invested in stock B.
Stock A Stock B
2005
-12
16
2006
13 20
2007
8
7
2008
-1 -1
2009
5 -12
2010
6 15
The standard deviation of the portfolio is?
In: Finance
The company I am using is Adidas, Inc for the year 2019.
Your task is to determine the WACC for a given firm using what you know about WACC, as well as data you can find through research. Your deliverable is a brief report in which you state your determination of WACC, describe and justify how you determined the number, and provide relevant information as to the sources of your data. Select a publicly traded company that has debt or bonds and common stock to calculate the current WACC. One good source for financial data for companies, as well as data about their equity, is Yahoo! Finance. By looking around this site, you should be able to find the market capitalization (E) as well as the β for any publicly traded company. There are not many places left where data about corporate bonds is still available. One of them is the Finra Bonds website. To find data for a particular company’s publicly traded bonds use the Quick Search feature, then be sure to specify corporate bonds and type in the name of the issuing company. This should give you a list of all of the company’s outstanding bond issues. Clicking on the symbol for a given bond issue will lead you to the current amount outstanding and the yield to maturity. You are interested in both. The total of all bonds outstanding is D in the above formula. If you like, you can use the YTM on a bond issue that is not callable as the pre-tax cost of debt for the company.
Assumptions: As you recall, the formula for WACC is: rWACC = (E/E+D) rE + D/(E+D) rD (1-TC) The formula for the required return on a given equity investment is: ri= rf + βi * (RMkt-rf) RMkt-rf is the Market Risk Premium. For this project, you may assume the Market Risk Premium is 5% unless you can develop a better number. rf is the risk-free rate. The risk-free rate is normally the yield on US Treasury securities such as a 10-year treasury. For this assignment, please use 3.5%. You may assume a corporate tax rate of 40%.
Submit the following: Write a 350- to 700-word report that contains the following elements: Your calculated WACC How data was used to calculate WACC (provide the formula and the formula with your values substituted) Sources for your data A discussion of how much confidence you have in your answer, including what the limiting assumptions you made were, if any Include a Microsoft® Excel® file showing your WACC calculations discussed above.
In: Accounting
American customer satisfaction index: Starbucks in the U.S. 2006-2016
|
2006 |
77 |
|
2007 |
78 |
|
2008 |
77 |
|
2009 |
76 |
|
2010 |
78 |
|
2011 |
80 |
|
2012 |
76 |
|
2013 |
80 |
|
2014 |
76 |
|
2015 |
74 |
|
2016 |
75 |
1. Plot this set of data as a scatterplot in excel. Insert excel graph here:
2. Find the correlation coefficient.
3. Is it positive or negative?
4. What does the sign tell us?
5.What does the correlation imply about the relationship between the time and the satisfaction?
6. Is the correlation significant? Why or why not? (Answer in 1-2 complete sentences.) (Use the Pearson calculator).
7. Draw the trendline in excel. Can the regression line be used for prediction? No, it is too weak. Insert excel graph here:
In: Statistics and Probability
Using the Property Theory and the Contract Theory of entity governance, compare and contrast the ethics challenges facing a closely-held business (one with one or only a few shareholders or owners), on one hand, and a publicly-traded corporation consisting of a variety of shareholders, on the other hand, including a description of the primary causes and effects of such challenges.
In: Finance
Pick 10 publicly traded U.S. stocks which have at least three years trading history. Try to limit yourself to S&P 500 stocks. Do not choose Mutual funds, Exchange Trade Funds (ETF), or Real Estate Investment Trusts (REIT). Why why chose them?
In: Finance
Assume you are a shareholder in a publicly traded retail firm. Would you want that firm to raise pay rates for its employees to stay on pace with the inflation rate, even if doing so would drive product prices up and profit margins down? Can you explain why for me please?
In: Operations Management
Deaths from all Causes
Fill-in the tables below with the following information for each of the age groups:
Calculate the age-specific all cause death rates for each group and the proportionate mortality ratio (PMR) for accidents (unintentional injuries).
TABLE A
|
2006 population |
Deaths in 2006 (All causes) |
Deaths from Accidents, 2006 |
Age-Specific All Cause Death Rate (per 100,000) |
|
|
Total |
274,633,642 |
2,426,264 |
121,599 |
NA |
|
5-14 |
39,976,619 |
6,149 |
2,258 |
|
|
55-64 |
23,961,506 |
281,401 |
11,446 |
|
|
65-74 |
18,135,514 |
390,093 |
8,420 |
TABLE B
|
Measure of Mortality from Accidents |
5-14 years |
55-64 years |
Ratio of age groups: (5-14) / (55-64) |
65-74 years |
Ratio of age groups: (5-14) / (65-74) |
|
Number of Deaths from Accidents |
|||||
|
Cause-Specific Death Rates from Accidents (per 100,000) |
|||||
|
PMR (%) |
e. Assuming the following information is accurate, calculate the case-fatality rate for accidents in 2006.
|
Age Group |
Total Number of Accidents |
Case-Fatality Rate |
|
All ages |
5,456,215 |
|
|
5-14 years |
109,654 |
|
|
55-64 years |
256,447 |
|
|
65-74 years |
456,125 |
|
Selected Formulas
Age-specific death rate = # of deaths per age stratum/
Population per age stratum
Accident-specific death rate = # of deaths from accidents per age stratum/
Population per age stratum
Accident case-fatality rate = # of deaths from accidents per age stratum/
Total # of accidents per age stratum
Mortality Rate = __# of deaths___/
Population at Risk
Proportionate Mortality Ratio = # of deaths from accidents per age stratum/
Total # of deaths per age stratum
In: Statistics and Probability
In: Finance