Question: Please answer all questions (8-11) and show work or what to input in financial calculator To help finance a major expansion, Castro Chemical Company sold
To help finance a major expansion, Castro Chemical Company sold a noncallable bond several years ago that now has 20 years to maturity. This bond has a 9.25% annual coupon, paid semiannually, sells at a price of $1,025, and has a par value of $1,000. If the firm's tax rate is 40%, what is the component after-tax cost of debt for use in the WACC calculation? Do not round your intermediate calculations. 5.93% 6.21% 5.39% 6.09% . C. d. 4.69% e. You are scheduled to receive annual payments of $5,100 for each of the next 7 years. The discount rate is 10 percent. What is the difference in the present value if you receive these payments at the beginning of each year rather than at the end of each year? $2,483 $2,513 $2,721 $2,727 $2,804 a. . C. d. e. 10. Taggart Inc.'s stock has a 50% chance of producing a 36% return, a 30% chance of producing a 109% return, and a 20% chance of producing a -28% return. What is the firm's expected rate of return? Do not round your intermediate calculations. 15.40% a. b. 15.71% 12.01% c. d. 15.86% 14.01% e. 1. Inflation, recession, and high interest rates are economic events that are best characterized as being systematic risk factors that can be diversified away. a. company-specific risk factors that can be diversified away. c. among the factors that are responsible for market risk. d. risks that are beyond the control of investors and thus should not be considered by b. security analysts or portfolio managers. irrelevant except to governmental authorities like the Federal Reserve
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