Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

problem: Jake's Sound Systems has 210,000 shares of common stock outstanding at a market price of $36 a share. Last month, Jake's paid yearly dividend in the amount of $1.593 per share. The dividend growth rate is four percent. Jake's also has 6,000 bonds outstanding with a face value of $1,000 per bond. The bonds carry a 7% coupon, pay interest yearly, & mature in 4.89 years. The bonds are selling at 99 percent of face value. The company's tax rate is 34%. find out Jake's weighted average cost of capital?      

[A]     6.3%

[B]    6.9%

[C]     7.2%

[D]     5.3%

[E]    5.8%

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M919417

Have any Question? 


Related Questions in Basic Finance

Consider a 0 5 super senior tranche and a index cds spread

Consider a [0%, 5%] super senior tranche, and a index CDS spread of 400 bps for 5 years maturity assuming 0% recovery and 0% interest rates. We'll be pricing this tranche using one factor gaussian copula. a) What is the ...

The carlton corporation has 5 million in earnings after

The Carlton Corporation has $5 million in earnings after taxes and 2 million shares outstanding. The stock trades at a P/E of 20. The firm has $4 million in excess cash. a. Compute the current price of the stock. b. If t ...

Commenting on the abacus cdo case wall street journal

Commenting on the Abacus CDO case, Wall Street Journal columnist Brett Arends offered the opinion that "as a rule of thumb, the more complex a [financial] product is, the worse the deal." Do you agree? Why would a more c ...

Directions update the data with your recommendations for

Directions: Update the data with your recommendations for the blue cells, then use Solver to determine the minimum variance portfolio Choose the index for each asset class, type the name below and paste in the relevant r ...

In addition to the key words you should also be able to

In addition to the key words, you should also be able to define the following terms: within-subjects design repeated-measures design participant attrition history maturation instrumentation testing effects statistical re ...

1 you are trying to value zombie games inc a company

1. You are trying to value Zombie Games Inc,, a company that manufactures games for the major game systems. You have been provided the following information: · The firm generated $ 30 million as operating profit (EBIT) i ...

Go to one of the web sites that contain video clips such as

Go to one of the Web sites that contain video clips (such as www.youtube.com) and view some video clips about banking tips. You can use search phrases such as "banking tips." Select one video clip on this topic that you ...

Grace carter purchased 100 shares of the stock of rock

Grace Carter purchased 100 shares of the stock of Rock Securities one year ago. Last year the price of the stock was $50 per share. In the year, Rock Securities paid a dividend of $2.40 per share. The price of the stock ...

Assuming the borrower is in no danger of default under what

Assuming the borrower is in no danger of default, under what conditions might a lender be willing to accept a lesser amount from a borrower than the outstanding balance of a loan and still consider the loan paid in full?

Esthers egg farm is constructing its pro forma financial

Esther's Egg Farm is constructing its pro forma financial statements for this year. At year end, assets were $500,000 and accounts Payable were $125,000, Notes payable $100,000. Long-Term Debt is $37,000. Last year's sal ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro