Question: Please help I am taking a test now. Need answers asap! Westchester Corp. is considering two equally risky, mutually exclusive projects, both of which have
Westchester Corp. is considering two equally risky, mutually exclusive projects, both of which have normal cash flows. Project A has an IRR of 11%. while Project B's 1RR is 14%. When the WACC is 8%, the projects have the same NPV. Given this information, which of the following statements is CORRECT? If the WACC is 13%, Project A's NPV will be higher than Project B's. If the WACC is 9%, Project B's NPV will be higher than Project A's. If the WACC is 6%, Project B's NPV will be higher than Project A's. If the WACC is 9%, Project A's NPV will be higher than Project B's. If the WACC is greater than 14%, Project A's IRR will exceed Project B's. A company's perpetual preferred stock currently sells for Si 12.50 per share, and it pays an $8.00 annual dividend. If the company were to sell a new preferred issue, it would incur a flotation cost of 5.00% of the issue price. What is the firm's cost of preferred stock? 7.49% 6.96% 8.83% 8.31% 7.41% Suppose a State of New York bond will pay $1,000 ten years from now. If the going interest rate on these 10 year bonds is 4.4%, how much is the bond worth today? $754.14 $604.61 $650.12 $526.60 $708.63
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