Dear Tutor, please can you assist with the following questions. I would also appreciate it if you can provide the calculations you used., ,1. A firm has current assets of $200, net fixed assets of $400, accounts payable of $150, long-term debt of $150, equity of $300, sales of $2,000, costs of $1,500, and a tax rate of 34 percent. Assume costs and assets increase at the same rate as sales. Also assume that 40 percent of net income is retained. The current debt-equity ratio is considered optimal and no new equity sales are possible. What is the maximum rate of growth given this information?,a) 17.5 percent,b) 19.4 percent,c) 21.4 percent,d) 25.8 percent,2. A firm has net income of $200, total assets of $1,200, and total liabilities of $400. The total asset turnover ratio is 3. What is the sustainable growth rate assuming dividends paid total $60?,a) 13.8 percent,b) 11.5 percent,c) 16.2 percent,d) 21.2 percent,3. A firm has 2,000,000 shares of common stock outstanding with a market price of $2.00 each. It has 2,000 bonds outstanding, each with a market value of $1,200 (120 percent of face). The bonds mature in 15 years, have a coupon rate of 10 percent, and pay coupons annually. The firm’s beta is 1.2, the risk free rate is 5 percent, and the market risk premium is 7 percent. The tax rate is 34 percent. Compute the WACC.,a) 5.42 percent,b) 6.53 percent,c) 9.36 percent,d) 10.28 percent,4. Hartley Psychiatric, Inc. needs to purchase office equipment for its 2000 drive-in therapy centers nationwide. The total cost of the equipment is $2 million. It is estimated that the after-tax cash inflows from the project will be $210,000 annually forever. Hartley has a debt-to-value ratio of 40 percent based on market values. The firm’s cost of equity is 13 percent and its pre-tax cost of debt is 8 percent. The flotation costs of debt and equity are 2 percent and 8 percent, respectively. Assume the firm’s tax rate is 35 percent. What is the dollar flotation cost for the proposed financing?,a) $112,000,b) $118,644,c) $131,230,d) $152,098,5. The current spot rate between "euroland" and the U.S. is €.82 per $1.00. Expected inflation in "euroland" is 6 percent per year and expected inflation in the U.S. is 3 percent per year. If relative purchasing power parity holds, what is the expected exchange rate in 4 years?,a) €.870 per $1.00,b) €.896 per $1.00,c) €.923 per $1.00,d) €.951 per $1.00,,
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