Question

ABC is currently in this situation. (1) EBIT = $4.7 million; (2) tax rate = .40; (3) D=$2 million; (4) rd = .10; (5) rs = .15; (6) shares outstanding = 600,000; and stock price = $30. The debt is perpetual and all earnings are paid out as dividends.
(a) What are the total market value of the firm’s stock and the firm’s total market value?
(b) What is the firm’s weighted average cost of capital?



$1.99
Sales0
Views149
Comments0
  • CreatedAugust 05, 2013
  • Files Included
Post your question
5000