Answer:
a) total debt = $38 million
after tax cost of debt = 8% x (1 - 35%) = 5.2%
total preferred stocks = $15 million
cost of preferred stock = 10%
total common stocks = 4,125,000 x 20% = $82,500,000
Re = 5% + (1.25 x 8%) = 15%
weight of debt = 38 / 135.5 = 28.04%
weight of preferred stocks = 15 / 135.5 = 11.07%
weight of common stocks = 60.89%
WACC = (60.89% x 15%) + (11.07% x 10%) + (28.04% x 5.2%) = 11.7%
b) The project should be rejected because 11% is lower than the company's WACC (11.7%)
Answer:
Option C
Number of shares outstanding after split = 150,000 units
Explanation:
<em>A stock split occurs where a company creates additional shares in units such the total nominal value of the outstanding shares remains the same. With a stock split, the total outstanding shares increases without a change in the total nominal value while the nominal value per share reduces.</em>
Total shares before the split = 50,000
Total outstanding shares after split
= 50,000 × 3 = 150,000
Number of shares outstanding after split = 150,000 units
Answer:
The correct options are;
Photos taken by a student in his blog
An illustration sold by an artist on her website
An excerpt from a novel published in 1913
Explanation:
With the copyright law the holder of a copyrighted material has the exclusive authority to grant permission to others to create from, copy, distribute, or display in public, the copyrighted material.
A copyright is said to have expired and to be in public domain (with automatic permission to use) when it has been up to 120 years since it was created. Government created material are not covered by the copyright law and can be used
Copyright material can only be used without the express permission of the copyright owner when it is covered by the TEACH Act of the usage must be taken as "fair use"
Therefore,
1) photos taken by a student in his blog
2) An illustration sold by an artist on her website
3) An excerpt from a novel published in 1913 are copyrighted online materials.
Answer:
a. $6,237.
Explanation:
We use the PMT formula i.e shown in the attachment below:
Data provided in the question
Present value = $850,000
Future value = $0
Rate of interest = 8% ÷ 12 months = 0.66666%
NPER = 30 years × 12 months = 360 months
The formula is shown below:
= PMT(Rate;NPER;-PV;FV;type)
The present value come in negative
So, after solving this, the monthly mortgage payment is $6,237
Answer:
a) 5%; 55%
Explanation:
The unemployment rate is calculated by dividing the number of people unemployed by the number of people in the workforce:
1/20= 0,05*100= 5%
The participation rate is calculated by dividing the number of people employed by the number of people in the workforce:
11/20= 0,55*100= 55%