Question: could you please answer without using excel PLEASE!!!!!!!!! 1. (WACC) A firm has 100 bonds outstanding with 10 years until maturity. The bonds pay an

could you please answer without using excel PLEASE!!!!!!!!!

could you please answer without using excel PLEASE!!!!!!!!! 1. (WACC) A firm

1. (WACC) A firm has 100 bonds outstanding with 10 years until maturity. The bonds pay an annual coupon, a coupon rate of 3%, a face value of $1,000, and a yield to maturity of 2.75%. Also, the firm has 50,000 shares of stock outstanding. The stock has a beta of 1.4 and a current price of $12. The risk-free rate is 1.5% and the expected return on the market is 8%. Finally, the firm has 1,000 shares of preferred stock outstanding. The preferred stock has a price of $24 and pays a $2 annual dividend. The firm's tax rate is 21%. What is the weighted average cost of capital for this firm

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

1. A corporation's bonds have 10 years until maturity, a 5% annual coupon (paid annually), a par value of $1,000 and a yield to maturity of 4%. What is the bond's price? 2. A corporation's bonds have...

Computing sells for $ 5 0 , and last year's dividend was $ 2 . 1 0 . Security analysts are projecting that the common dividend will grow at a rate of 7 % a year. A flotation cost of 1 3 % would be...

Excel Activity: WACC Start with the partial model in the file Ch11 P18 Build a Model.xlsx . The stock of Gao Computing sells for $50, and last year's dividend was $2.64. Security analysts are...

Start with the partial model in the file Ch11 P18 Build a Model.xisx. The stock of Gao Computing sells for $60, and last year's dividend was \$1.94. Security analysts are projecting that the common...

Start with the partial model in the file Ch11 P18 Build a Model.xlsx. The stock of Computing sells for $70, and last year's dividend was $3.96Security analysts are projecting that the common dividend...

Start with the partial model in the file Ch11 P18 Build a Model.x/s. . The stock of Gao Computing sells for $60, and last year's dividend was $2.22. Security analysts are projecting that the common...

9 Excel Activity: WACC Start with the partial model in the file Ch 1 1 P 1 8 Build a Model.xlsx . The stock of Gao Computing sells for $ 5 0 , and last year's dividend was $ 3 . 1 3 . Security...

Ch. 12 Practice Exercise:\ \ Step by Step Contractors has the following information:\ \ -A Beta of 1.5\ \ -A current price of common stock of $45/share, with 2M shares outstanding \ \ -A preferred...

Acme Chemical, Inc. is a major manufacturer of chemical products for the agricultural industry, including pesticides, herbicides and other compounds. Due to a number of law suits related to toxic...

The stock of Gao Computing sells for $50, and last year's dividend was $3.13. Security analysts are projecting that the common dividend will grow at a rate of 7% a year. A flotation cost of 10% would...

Marconi Communications last seven years returns are as follows: 19%, 22%, -21%, 26%, -4%, 16%, 2% What is the geometric average annual return for the firm?

Kulle Optical Ltd. purchased optical lens coating equipment for $101,600 on January 1, 2020. At that time, management determined that the equipment would have a useful life of five years and a...

What is the prevalent method used by exporters to hedge country risk? Question 5 options: Revocable letter of credit Political risk insurance Denominating export receivable in the exporter's home...

10) For a bond that pays cash interest (i.e., not a zero coupon bond), YTM is (a) always equal to the coupon rate (b) always equal to the current yield (c) is always less than the coupon rate (d) can...

4. To what extent do you think measures of a countrys wellbeing should be included when comparing the performance of countries? Should there be something like the balanced scorecard, discussed in...

2. In your opinion do you think that measures of social performance should be considered when deciding managers pay? If so what measures should be used?

2. Obtain a copy of the safety policy for either your college or your workplace. a. Use this to identify the roles of various people in the organisation in relation to health and safety. b. Use the...