What is the Model commonly used to calculate the cost of equity (common stocks)?
a. Black and Scholes Pricing Model
b. Arbitrage Pricing Model
c. Capital Asset Pricing Model
d. Miller and Modigliani Model
In: Finance
The cost of producing x records is C(x) = 20x + 450. If the revenue generated from sales is R(x) = 35x, then determine the break-even value.
a.1150 units
b. 30 units
c. 20.75 units
d. 8 units
In: Finance
A firm has a currentmarketvalueofINR250 crores. The current cost of equity is 15%and the tax rate is 20 percent. If the firm has announced to issue a per- petual debt of INR 50 crores at 6% interest rate to change the capital structure of the firm, what is the market value of the firm after this announcement?
In: Finance
When a country's risk-free rate falls, the cost of equity to an MNC in that country ___, and the cost of debt to an MNC in that country __, other things held constant.
increases; increases
decreases; decreases
is not affected; increases
is not affected; is not affected
In: Finance
A firm has a currentmarketvalueofINR250 crores. The current cost of equity is 15%and the tax rate is 20 percent. If the firm has announced to issue a per- petual debt of INR 50 crores at 6% interest rate to change the capital structure of the firm, what is the market value of the firm after this announcement?
In: Finance
BCC is looking to acquire ZZP Co. This investment will cost $2.3 million and is expected to give BBC returns of $680,000 yearly for the next 11 years. ZZP has a beta of 2.1. The current treasury bond rate is 3.7% while the stock market return is 14.9%. Calculate the risk-adjusted discount rate for ZZP and the risk-adjusted NPV. Should BBC acquire ZZP? State your reasons.
In: Finance
| The following are the transactions for the month of July. |
| Units | Unit Cost | Unit Selling Price |
||||||||
| July 1 | Beginning Inventory | 45 | $ | 10 | ||||||
| July 13 | Purchase | 225 | 13 | |||||||
| July 25 | Sold | ( | 100 | ) | $ | 15 | ||||
| July 31 | Ending Inventory | 170 | ||||||||
|
Calculate cost of goods available for sale and ending inventory, then sales, cost of goods sold, and gross profit, under (a) FIFO, (b) LIFO, and (c) weighted average cost. Assume a periodic inventory system is used. (Round "Cost per Unit" to 2 decimal places and your final answers to nearest whole dollar amount.) |
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In: Finance
When a country's risk-free rate falls, the cost of equity to an MNC in that country _____, and the cost of debt to an MNC in that country ____, other things held constant.
In: Finance
If a company adds 60 new workstations at a cost of $100,000 each and also spends $20 million for additional space in its camera/drone assembly facilities to accommodate more workstations, then its annual depreciation costs will rise by?
How do I know what deprecijation rate to use? *** (ie. 4% or 5%)
In: Finance
Estimate this company's cost of common equity.
This is a set of data you were able to collect. Upcoming dividend
(D1) = $2.25; Price as of today = $27.50; Capial Gain Yield= 7.00%
(constant); and F = 10.00%; Tax rate =40%.
What is the cost of equity raised by selling new common stock?
In: Finance