Question: this is 1 question, please answer asap, due soon 4. Broblera to,07 (Cast ol fordmon Lquity with and without tiotation) Empire Electric Company (EEC) uses


4. Broblera to,07 (Cast ol fordmon Lquity with and without tiotation) Empire Electric Company (EEC) uses only debt and common equity. It can borrow unlimited amounts at an interest rate of rd a 10% as long as it finahces at its target capital structure, which calis for 40% debt and 60% common equity, its last dividend (D.) was $2.75, its expected constant growth rate is 6 th, and its common stock selis for $24. EEC's tax rate is 25%. Two projects are avallable: Project A has a rate of return of 15%, and Project B's retum is 11mb. These two projects are equally risky and about as risky as the firm's existing assets. 8. What is it cost of common equity? Do hot round intermediate calculations. Round your answer to two decimal places. b. What is the WACc? Do not round intermediate calculations. Round your answer to two decimal places. c. Which projects thould Empire accept? The Evanec compony't hext expected dividend, D1, is 52.71; its growth rate is 7%; and its common atock now selis for 531.00. New stock (axtarnal equity) cen be sold to net s.26:35 per share. 4. What it Evanec's cont of retained eamings, n? Do not round intermediate calculations. Round your anawer to two decimal places. b. What is Evanects percentage fiotation cont, F? Round your answer to two decimal places. c. Whnt it Evanec's cost of new common stock, fe? Do not round intermediate calculations. Round your answer to two decimal placas. re=
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