If a company has 5,000,000 shares outstanding that are valued at $8 per share, how many shares will be outstanding after the company performs a 3-for-1 stock split? A. 5,000,000 B. 1,650,000 C. 10,000,000 D. 15,000,000
Your firm is considering a project with the following timeline and cash flows: l Year 0: –$3,000 l Year 1: $850 l Year 2: $980 l Year 3: $1,010 l Year 4: $1,200 l Year 5: $1,450 If the appropriate cost of capital is 9 percent, what's the NPV statistic for the project, and should the firm accept or reject the project with the cash flows given? A. $1,177.08; Accept B. –$1284.19; Reject C. $1,326.24; Reject D. –$1124.45; Accept
The most common reason firms have unused fixed-asset capacity is that fixed assets A. usually aren't infinitely divisible. B. are tax deductible. C. can't be purchased on credit. D. are subject to depreciation.
The common shares of Jones & Smith, Inc. sell for $22 per share. The firm is expected to set its next annual dividend at $0.68 per share, and all future dividends are expected to grow by 5 percent per year indefinitely. If Jones & Smith, Inc., experiences a flotation cost of 15 percent on new equity issues, what will be the flotation-adjusted cost of equity? A. 5.87 percent B. 6.63 percent C. 7.92 percent D. 8.81 percent