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Rumolt Motors has 33 million shares outstanding with a price of $18 per share. In addition,...
Rumolt Motors has 6363 million shares outstanding with a price of $ 49 per share. In...
Rumolt Motors has 6363 million shares outstanding with a price of $ 49 per share. In addition, Rumolt has issued bonds with a total current market value of $ 3,335 million. Suppose Rumolt's equity cost of capital is 12 % and its debt cost of capital is 8%. a. What is Rumolt's pretax weighted average cost of capital? b. If Rumolt's corporate tax rate is 21%, what is its after-tax weighted average cost of capital?
Rumolt Motors has 29 million shares outstanding with a share price of $52 per share. In...
Rumolt Motors has 29 million shares outstanding with a share price of $52 per share. In addition, Rumolt has issued bonds with a total current market value of $1,212 million. Suppose Rumolt's equity cost of capital is 10%, and its debt cost of capital is 6%. a. What is Rumolt's pre-tax WACC? b. If Rumolt's corporate tax rate is 35%, what is its after-tax WACC?
Unida Systems has 37 million shares outstanding trading for $ 12 per share. In addition, Unida...
Unida Systems has 37 million shares outstanding trading for $ 12 per share. In addition, Unida has $ 109 million in outstanding debt. Suppose Unida's equity cost of capital is 13 % , its debt cost of capital is 7 % , and the corporate tax rate is 36 % . a. What is Unida's unlevered cost of capital? b. What is Unida's after-tax debt cost of capital? c. What is Unida's weighted average cost of capital?
Unida Systems has 42 million shares outstanding trading for $8 per share. In addition, Unida has...
Unida Systems has 42 million shares outstanding trading for $8 per share. In addition, Unida has $118 million in outstanding debt. Suppose Unida's equity cost of capital is 12%, its debt cost of capital is 8%, and the corporate tax rate is 32%. a. What is Unida's unlevered cost of capital? b. What is Unida's after-tax debt cost of capital? c. What is Unida's weighted average cost of capital?
Arnell is a company that has issued 30 million shares worth $15 each. In addition, it...
Arnell is a company that has issued 30 million shares worth $15 each. In addition, it has issued bonds for $150 million. The cost of equity is 10% and the cost of debt is 5%. The corporate tax rate is 33%. What is the weighted average cost of capital (WACC) before and after tax?
Suppose a firm has 33 million shares of common stock outstanding at a price of $40...
Suppose a firm has 33 million shares of common stock outstanding at a price of $40 per share. The firm also has 200,000 bonds outstanding with a current price of $1005.2. The outstanding bonds have yield to maturity 10.8%. The firm's common stock beta is 1.2 and the corporate tax rate is 36%. The expected market return is 12% and the T-bill rate is 6%. What is the WACC for this firm? (All answers should be in the format of...
QUESTION 33 Western Electric has 20,500 shares of common stock outstanding at a price per share...
QUESTION 33 Western Electric has 20,500 shares of common stock outstanding at a price per share of $74 and a rate of return of 13.25 percent. The firm has 7050 shares of 7.30 percent preferred stock outstanding at a price of $92.50 per share. The preferred stock has a par value of $100. The outstanding debt has a total face value of $389,000 and currently sells for 108.5 percent of face. The yield to maturity on the debt is 7.93...
Denver Interiors has 60,000 shares of common stock outstanding at a price per share of $46....
Denver Interiors has 60,000 shares of common stock outstanding at a price per share of $46. The firm also has 20,000 shares of preferred stock outstanding at a price per share of $55. There are 1,500 outstanding bonds with a face value of $1,000 and a price quote of 99.4. What is the capital structure weight of the preferred stock? 18.87 percent 21.38 percent 21.09 percent 20.56 percent 3. Meiston Press has a debt-equity ratio of 1.40. The pre-tax cost...
A firm has the following capital structure: 100 million shares outstanding, trading at £1.5 per share,...
A firm has the following capital structure: 100 million shares outstanding, trading at £1.5 per share, and £100 million of debt. The beta of the firm’s stock is 1.5. The firm’s cost of equity is 10 percent, and the yield on riskless bonds is 2.5 percent. There is no tax. Assuming that the firm can borrow at the risk free rate and that both CAPM (Capital Asset Pricing Model) and the Modigliani-Miller theorem hold, answer the following questions. i) What...
Rumolt Motors has 29 million shares outstanding with a share price of $52 per share. In addition, Rumolt has issued bonds with a total current market value of $1,212 million. Suppose Rumolt's equity cost of capital is 10%, and its debt cost of capital is 6%. a. What is Rumolt's pre-tax WACC? b. If Rumolt's corporate tax rate is 35%, what is its after-tax WACC?
Unida Systems has 42 million shares outstanding trading for $8 per share. In addition, Unida has $118 million in outstanding debt. Suppose Unida's equity cost of capital is 12%, its debt cost of capital is 8%, and the corporate tax rate is 32%. a. What is Unida's unlevered cost of capital? b. What is Unida's after-tax debt cost of capital? c. What is Unida's weighted average cost of capital?
QUESTION 33 Western Electric has 20,500 shares of common stock outstanding at a price per share of $74 and a rate of return of 13.25 percent. The firm has 7050 shares of 7.30 percent preferred stock outstanding at a price of $92.50 per share. The preferred stock has a par value of $100. The outstanding debt has a total face value of $389,000 and currently sells for 108.5 percent of face. The yield to maturity on the debt is 7.93...
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