Question: 1) (PI) Compute the PI statistic for Project Q if the appropriate cost of capital is 11 percent. (Do not round intermediate calculations and round
1)
(PI) Compute the PI statistic for Project Q if the appropriate cost of capital is 11 percent. (Do not round intermediate calculations and round your final answer to 2 decimal places.)
| Project Q |
| ||||
| Time | 0 | 1 | 2 | 3 | 4 |
| Cash flow | -$11,700 | $3,700 | $4,530 | $1,870 | $2,500 |
2) KatyDid Clothes has a $160 million (face value) 20-year bond issue selling for 101 percent of par that carries a coupon rate of 12 percent, paid semiannually. What would be Katydids before-tax component cost of debt? (Round your answer to 2 decimal places.)
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