Answers need to be done in excel full works showed,7-2,Boehm Incorporated is expected to pay a $1.50 per share dividend at the end of this year (i.e. D1 = $1.50). The dividend is expected to grow at a constant rate of 7% a year. The required rate of return on the stock, rs, is 15%. What is the value per share of Boehm’s stock?,7-4,Nick’s Enchiladas Inc has preferred stock outstanding that pays a dividend of $5 at the end of each year. The preferred sells for $50 a share. What is the stock’s required rate of return?,7-5,A company currently pays a dividend of $2 per share (D0 = $2). It is estimated that the company’s dividend will grow at a rate of 20% a year for the next 2 years, then at a constant rate of 7% thereafter. The company’s stock has a beta of 1.2, the risk-free rate is 7.5%, and the market risk premium is 4%. What is your estimate of the stock’s current price?,9-2,LL Incorporated’s currently outstanding 11% coupon bonds have a yield to maturity of 8%. LL believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 35%, what is LL’s after-tax cost of debt?,,9-4,Burnwood Tech plans to issue some $60 par preferred stock with a 6% dividend. A similar stock is selling on the market for $70. Burnwood must pay flotation costs of 5% of the issue price. What is the cost of the preferred stock?,,9-5,Summerdahl Resort’s common stock is currently trading at $36 a share. The stock is expected to pay a dividend of $3.00 a share at the end of the year (D1 = $3), and the dividend is expected to grow at a constant rate of 5% a year. What is its cost of common equity?,,,9-6,Booher Book Stores has a beta of 0.8. The yield on a 3-month T-bill is 4% and the yield on a 10 year T-bond is 6%. The market risk premium is 5.5%, and the return on an average stock in the market last year was 15%. What is the estimate cost of common equity using the CAPM?,,9-7,Shi Importer’s balance sheet shows $300 million in debt, $50 million in preferred stock, and $250 million in total common equity. Shi’s tax rate is 40%, rd = 6%, rps = 5.8% and rs = 12%. If Shi has a target capital structure of 30% debt, 5% preferred stock and 65% common stock, what is its WACC?,

Order Your Custom Essay

Order Your Custom Essay

Regent Papers is a library of common essays on high school, college, undergraduate and postgraduate topics. We have collected top papers from various institution, students and professors. The papers are based on common essay topics in all subjects.

M | T | W | T | F | S | S |
---|---|---|---|---|---|---|

« Oct | ||||||

1 | 2 | 3 | 4 | 5 | 6 | 7 |

8 | 9 | 10 | 11 | 12 | 13 | 14 |

15 | 16 | 17 | 18 | 19 | 20 | 21 |

22 | 23 | 24 | 25 | 26 | 27 | 28 |

29 | 30 | 31 |

© 2015 www.regentessays.com. All Rights Reserved