#4 Caspian Sea Drinks' is financed with 66.00% equity and the remainder in debt. They have...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
#4 Caspian Sea Drinks' is financed with 66.00% equity and the remainder in debt. They have 11.00-year, semi-annual pay, 5.38% coupon bonds which sell for 98.78% of par. Their stock currently has a market value of $25.28 and Mr. Bensen believes the market estimates that dividends will grow at 3.24% forever. Next year's dividend is projected to be $2.08. Assuming a marginal tax rate of 34.00%, what is their WACC (weighted average cost of capital)? Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924)) #4 Caspian Sea Drinks' is financed with 66.00% equity and the remainder in debt. They have 11.00-year, semi-annual pay, 5.38% coupon bonds which sell for 98.78% of par. Their stock currently has a market value of $25.28 and Mr. Bensen believes the market estimates that dividends will grow at 3.24% forever. Next year's dividend is projected to be $2.08. Assuming a marginal tax rate of 34.00%, what is their WACC (weighted average cost of capital)? Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924))
Expert Answer:
Posted Date:
Students also viewed these finance questions
-
What is a Java package, and what is its purpose?
-
Match the following terms with their definitions: ___ A. Extraordinary care ___ B. Inter vivos gift ___ C. Ordinary care ___ D. Gift causa mortis ___ E. Slight care 1. Cannot be revoked 2. Required...
-
As the chair for church committees, Mrs. Blasi is faced with scheduling the meeting times for 15 committees. Each committee meets for one hour each week. Two committees having a common member must be...
-
The Busy B Company wants to store data about its employees skills. Each employee may possess one or more specific skills. In addition, several employees may have the same skill. The following facts...
-
The following balances appeared in the general ledger accounts of Fenton Table Rentals Corporation at April 1, 2019. Required: 1 Prepare journal entries to record the April transactions shown on the...
-
21 As discussed in class, how does a company determine its optimal capital structure? only use retained earnings reduce earnings volatility maximize the firm owners' wealth minimize debt level
-
Solve 6. secx Stan 4 1 - tan x dx
-
What do you think the future of strategic human resource management and the challenges it faces on issues such as working virtually, satisfying the needs of a diverse workforce, the impact of social...
-
The following data from the just-completed year are taken from the accounting records of Eccles Company: Sales Direct labour cost $776,000 109,000 Raw material purchases 151,000 Selling expenses...
-
9 If in the initial position is set at yo = 0, what is the final position y? Enter the numerical value in Sl units. Type your answer..... 11 2 points What is the initial velocity voy? Enter the...
-
A shaft of solid circular cross section has a diameter, d. The shaft is subjected to the torque, T, and compressive load, P, as shown in the figure. T=Pd/8 (A) Define the in-plane stresses on a...
-
For sgupta20: 700 words, Original Work, References Included, Plagerism free. In text citation included. Write a paper in which you examine the field of abnormal psychology. Address the following...
-
A fully discrete whole life insurance is issued to (35) with a face amount of 100000 mortality is based on the LTAM life table with an annual effective interest rate of 5% The annual contract premium...
-
Factor and simplify, if possible. Check your result using a graphing calculator. 3 cot 2 + 6 cot + 3
-
The following information is available from the financial statements of the Philips Company. Compute the current ratio and the debt-to-total-assets ratio and comment on any trends observed between...
-
The following information is available for the Owner Company: Prepare a statement of stockholders equity for the Owner Company. How much of the total equity is considered contributed capital and how...
-
The following information is available from the financial statements of the Philips Company. Compute the free cash flow and comment on any trends observed between 2018 and 2019. Net sales. Net...
Study smarter with the SolutionInn App