Concept of cost of capital and WACC Mace Manufacturing is in the process of analyzing its investment decision-making procedures. Two projects evaluated by the firm recently involved building new facilities in different regions, North and South. The basic variables surrounding each project analysis and the resulting decision actions are summarized in the following table.

1. An analyst evaluating the North facility expects that the project will be financed by debt that costs the firm 7%. What recommendation do you think this analyst will make regarding the investment opportunity?

2. Another analyst assigned to study the South facility believes that funding for that project will come from the firm’s retained earnings at a cost of 16%. What recommendation do you expect this analyst to make regarding the investment?

3. Explain why the decisions in parts a and b may not be in the best interests of the firm’s investors.

4. If the firm maintains a capital structure containing 40% debt and 60% equity, find its weighted average cost of capital (WACC) using the data in the table.

5. If both analysts had used the WACC calculated in part d, what recommendations would they have made regarding the North and South facilities?

6. Compare and contrast the analyst’s initial recommendations with your findings in part e. Which decision method seems more appropriate? Explain why.

Suppose a country trades with three countries: Brazil (20% of trade), China (45%), and France (35%). Over the last year, the currency of this country has depreciated by 4% against the Brazilian real, appreciated by 3% against the Chinese yuan, and depreciated by 7% against the euro. What has happened to the effective exchange rate of the country? (8 points)

Suppose that, for students who are enrolled in college algebra, 72 percent are freshman, 40 percent are female, and 25 percent are female and freshman. Your answers should be entered as decimals and rounded to three decimal places.

(A) one student will be selected at random. What is the probability that the selected student will be a freshman or female (or both)? ___

(B) one student will be selected at random. What is the probability that the selected student will not be a freshman? ___

(C) two students will be independently selected at random. What is the probability that both of the selected students will be female? __

Two people are headed towards each other on skateboards and experience very little friction or airresistance. One person has massm1= 40 kg and one has mass m2= 80 kg. If they are going equal velocities(v = 3 m/s)before the collision, which direction will they be going afterward? How fast?What if we allow the lighter person to start off on a hill of height h. What should h be so that after the collision both skateboarders have stopped?

1. Create a Binary Search Tree for the following data and do In-order, Preorder and Post-order traversal of the tree.

50, 60, 25, 40, 30, 70, 35, 10, 55, 65, 5

1. Write an algorithm to delete a node in Singly Linked List                            [12
2. Write an algorithm of Binary Search                                                              [10]
3. Write a program in ‘C’ to generate Fibonacci series using recursion            [8]

The length of time junior high school students sleep per night follows an approximate uniform distribution from seven to eleven hours. Suppose we randomly select a junior high student.

1. Find the probability that the randomly selected student sleeps less than 8 1/2 hours per night.

A. 0. 375

B. 0. 4705

C. 0. 7727

D. . 2143

2. On average, how long does a junior high school student sleep per night ?

A. 9 hours

B. 8 hours

C. 4 hours

D. 11 hours

3. Find the probability that the randomly selected student sleeps eight to twelve hours per night?

A. 0. 4705

B. 0. 375

C. 0. 7727

D. . 2143

4. 65 % of junior high school students sleep at least how many hours ?

A. 8. 4 hours

B. 7. 8 hours

C. 6. 5 hours

D. 9. 6 hours

You have saved $10,000 for a down payment on the purchase of a new car, however, since you plan to buy the car one year from today, you need to decide how to invest the money for one year. You are limited to one of two choices:

1. A Bond Fund with an expected return of 3%/year

2. A Stock Fund with an expected return of 7%/year.

Which fund is best? Explain why!

To make a phrase/words, solve the 18 application of derivatives below.  Then replace each numbered blank with the letter corresponding to the answer for that problem. Show all solutions on the answers given below.

"   __ __ __ __ __ __ __       __ __ __ __      __ __ __ __ __ __ __      __ __ __ __ __      __ __ __ __ __"       

"__ __ __ __ __ __ __      __ __      __      __ __ __ __ __ __ __      __ __ __ __ __      __ __ __ ."     

Derivative Application Problems:      

1.  Find the equation of the line normal to the curve  f(x) = x³ – 3x²  at the point (1, -2).          

2.  Find the equation of the line tangent to the curve  x² y – x = y³ – 8  at the point where x = 0.          

3.  Determine the point(s) of inflection of  f(x) = x³ – 5x² + 3x + 6.         

4.  Determine the relative minimum point(s) of  f(x) = x⁴ – 4x³.        

5.  A particle moves along a line according to the law s = 2t³ – 9t² + 12t – 4, where t≥0 .  Determine the total distance traveled between t = 0 and t = 4.             

6.  A particle moves along a line according to the law s = t⁴ – 4t³, where t≥0.    Determine the total distance traveled between t = 0 and t = 4.        

7.  If one leg, AB, of a right triangle increases at the rate of  2 inches per second, while the other   leg, AC,  decreases at 3 inches per second, determine how fast the hypotenuse is   changing (in feet per second) when AB = 6 feet and AC = 8 feet.     

8.  The diameter and height of a paper cup in the shape of a cone are both 4 inches, and water is leaking   out at the rate of ½ cubic inch per second.  Determine the rate (in inches per second) at which  the water level is dropping when the diameter of the surface is 2 inches.     

9.  For what value of y is the tangent to the curve  y² – xy + 9 = 0 vertical?        

10.  For what value of  k  is the line  y = 3x + k tangent to the curve  y = x³ ?        

11.  Determine the slopes of the two tangents that can be drawn from the point (3, 5) to the parabola    y = x² .              

12.  Determine the area of the largest rectangle that can be drawn with one side along the x-axis and  

two vertices on the curve  y = e^-x2

13.  A tangent drawn to the parabola  y = 4 – x²  at the point (1, 3)  forms a right triangle with the   coordinate axes.  What is the area of this triangle?         

14.  If the cylinder of largest possible volume is inscribed in a given sphere, determine the ratio of the   volume of the sphere to that of the cylinder.

15.  Determine the first quadrant point on the curve  y²x = 18 which is closest to the point  (2, 0).     

16.  Two cars are traveling along perpendicular roads, car A at 40 mph, car B at 60 mph.  At noon when   car A reaches the intersection, car B is 90 miles away, and moving toward it.  At 1PM, what is   the rate, in miles per hour, at which the distance between the cars is changing?

1. Zenith Corporation is deciding between the introduction of two new automobiles: a traditional gasoline-powered model, or a hydrogen fuel-cell model. Incremental cash flows in millions are estimated to be:

Assume end-of-year cash flows, and that the appropriate discount rate for NPV analysis is 12%.

(a) Compute each project’s payback period.

(b) What is each project’s internal rate of return?

(c) Compute each project’s net present value.

(d) Assuming Zenith's goal is to maximize firm value, which project should be taken? Support your answer, including a short statement of which evaluation criterion was most relevant, which were less relevant, and why.