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Wittaler [7]
3 years ago
7

Costly Corporation is considering using equity financing. Currently, the firm's stock is selling for $26.00 per share. The firm'

s dividend for next year is expected to be $4.90 with an annual growth rate of 8.0% thereafter indefinitely. If the firm issues new stock, the flotation costs would equal 11.0% of the stock's market value. The firm's marginal tax rate is 40%. What is the firm's cost of internal equity
Business
1 answer:
makkiz [27]3 years ago
7 0

Answer: 26.85%

Explanation:

Based on the information given in the question, the firm's cost of internal equity will be calculated as:

Cost of equity = (D1/Current price) + Growth rate

= (4.90 / 26.00) + 8.0%

=(4.9/26) + 0.08

=26.85%

Therefore, the firm's cost of internal equity is 26.85%.

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Northfield Casino is considering converting the Polsky Building at University of Akron into a state-of-the-art gaming parlor. Th
Maurinko [17]

Answer:

d. 3 Years.

Explanation:

Payback period calculates the amount of time it takes to recover the amount invested in a project from its cumulative cash flows.

Payback period = amount invested / cash flow

$75,000,000 / $25,000,000 = 3 years

I hope my answer helps you

4 0
4 years ago
A federal budget deficit occurs when _____ Group of answer choices aggregate supply is greater than aggregate demand. aggregate
andre [41]

A federal budget deficit occurs when federal government purchases exceed net taxes. Option C is correct.

<h3>What is federal budget?</h3>

The federal budget is the budget of the United States. It comprises the federal government's spending and revenues.

The budget is the monetary or medium of exchange expression of the  priorities of the government and showing the past conflicts and conflicting economic views.

A federal budget deficit occurs when government spending exceeds revenue, which is the money collected from, fees, taxes and investments. Deficits add to the national debt, or debt owed by the federal government.

Therefore, option C is correct.

Learn more about the federal budget, refer to:

brainly.com/question/15374043

#SPJ1

3 0
3 years ago
The Toy Store has beginning retained earnings of $318,423. For the year, the company earned net income of $11,318 and paid divid
kherson [118]

Answer: $322 241

Explanation: Retained earnings is the capital that is left over after total dividends has been deducted and paid out. It is calculated as follows:

Retained earnings = retained earnings at the beginning of the year + net profits made during the current year - dividends paid out.

∴ Retained earnings = $318, 423 (opening Retained earnings)+ $11,318 (net profits / income) - $7,500 (dividends)

=$322,241

The $25,000 new stock issued generated income to the business, but this does not fall in the retained earnings line item. Rather it falls under the Ordinary Share Capital line item, which includes all the company's issued share capital.

7 0
3 years ago
Who wants to make a research paper here? i need help guys.​
enot [183]

Answer:

I don't want to make sorry

5 0
3 years ago
Monica is going to college full-time to become a nurse, so she has to quit her job at the supermarket. Not having that weekly pa
Nikolay [14]

Answer:

Opportunity cost

Explanation:

Opportunity cost is the sacrificed benefits in decision making. Making a decision involves selecting one option from several choices. The forfeited advantage from the next best alternative is the opportunity cost.

Monica has chosen to join college. She has sacrificed her job at the supermarket to make time for college. Her forfeited weekly pay from her job is the opportunity cost for joining college.

4 0
3 years ago
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