+1-415-315-9853

info@mywordsolution.com

## Finance

 Basic Finance Corporate Finance Financial Management Financial Econometrics Portfolio Management Risk Management Public Finance Business Law & Ethics

problem1: Compute the after tax cost of a 25 million dollar debt issue that Pullman Manufacturing Corporation (40% marginal tax rate) is planning to place privately with a large insurance company. This long-term issue will yield 6.6 percent to the insurance company.

problem2: Compute after tax cost of preferred stock for Bozeman-Western Airlines, Inc., which is planning to sell \$10 million of \$4.50 cumulative preferred stock to the public at a price of 48 dollar a share. The company has a marginal tax rate is 40 percent

problem3:  The given financial information is available on Fargo Fabrics, Inc.

Current per-share market price = \$20.25

Current per-share dividend = \$1.12

Current per-share earnings =\$2.48

Beta = .90

Expected market risk premium = 6.4%

Risk free rate [20 year treasury bonds] = 5.2%

Past ten years earnings per share:

20x1    \$1.39   20x6    \$1.95

20x2    1.48     20x7    2.12

20x3    1.60     20x8    2.26

20x4    1.68     20x9    2.40

20x5    1.79     20x10 2.48

This past earnings growth trend is expected to carry on for the foreseeable future. The dividend payout ratio has remained approximately constant over the past 10 years & is expected to remain at current levels for the foreseeable future.

Compute the cost of equity capital using the following methods:

[A]      The constant growth rate dividend capitalization model approach

[B]      The capital asset pricing model approach.

Basic Finance, Finance

• Category:- Basic Finance
• Reference No.:- M919107

Have any Question?

## Related Questions in Basic Finance

### A random sample of the birth weights of 186 babies has a

A random sample of the birth weights of 186 babies has a mean of 3103 g and a standard deviation of 691 g. Construct a 98% confidence interval estimate of the mean birth weight for all such babies. What is the confidence ...

### The yield on zero-coupon bonds are as followsus yen 1

The yield on zero-coupon bonds are as follows: U.S.\$ % Yen % 1 year    3.00       5.00 2 years   3.50       6.00 A young investment banker considers issuing a bond for ¥100 million. The interest or coupon is paid on year ...

### What is the current state of illicit financewhat are some

What is the current state of illicit finance? What are some examples of ways that we should consider how we define illicit finance? Both answers should be tied together with examples cited. Please contribute roughly 350- ...

### 1 explain the origin and purpose of real estate investment

1. Explain the origin and purpose of Real Estate Investment Trusts. 2. Name three primary market lenders that are not subject to banking regulations. 3. Describe a warehouse line of credit and who may use it. 4. Are ther ...

### 1 why can the current movement toward establishing supply

1. Why can the current movement toward establishing supply chains be characterized as a revolution? 2. Compare the concept of a modern supply chain with more traditional distribution channels. Be specific regarding simil ...

### In fig 911 is intermediate code to compute the dot product

In Fig. 9.11 is intermediate code to compute the dot product of two vectors A and B. Optimize this code by eliminating common subexpressions, performing reduction in strength on induction variables, and eliminating all t ...

### The following excerpt if from the notes to the financial

The following excerpt if from the notes to the financial statements in the 2009 Annual Report of Bank of America (p. 147): The Corporation enters into trading derivatives to facilitate client transactions for proprietary ...

### Finance assignmentquestion 1150- 200 wordsgo to the finra

Finance Assignment Question 1 150- 200 words Go to the FINRA Bonds Quick Search. http://finra-markets.morningstar.com/BondCenter/Screener.jsp • Click the Corporate check box under Bond Type then click Show Results. • Cho ...

### 1 explain how the publication financial analysis of the

1. Explain how the publication Financial Analysis of the Motor Carrier Industry could be used to determine the percentage of total revenue a firm has in relation to similar trucking firms. 2. Annual reports that insuranc ...

### An annual survey of first-year college students asks 270000

An annual survey of first-year college students asks 270,000 students about their attitudes on a variety of subjects. According to a recent survey, 54% of first-year students believe that abortion should be legal. Use a ...

• 13,132 Experts

## 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.

### 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

### Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen