Please show work if applicable.

1.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Disregard this.

Â

2.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â If you invest $8,000 today at 4 percent compounded monthly, how much will you have after 3 years?

Â

3.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â How much would you have to invest today in order to receive $10,000 in 3 years at an assumed 4% APR and quarterly compounding?

Â

4.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â What is the present value of $10,000 to be received for each of the next three years at an assumed 4 % APR.

Â

5.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Assume that you won a $ 20 million lottery. You are to receive $1 million a year for 10 years plus an additional $10 million lump sum payment at the end of the tenth year. What is the present value of this lottery payment schedule at an assumed discount rate of 3 %?

Â

6.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â What are theÂ monthlyÂ payments required in order to pay off a $30,000 auto loan at an assumed 1.5 % (one point five percent) APR over a three year period?

Â

7.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â A corporation issued a $1,000 par value bond paying 4% interest with 10 years to maturity. Assume the current yield to maturity on such bonds is 5 %. What is the price of the bond?

Â

8.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â A corporation will pay a $2.00 dividend (D1) in the next 12 months. The required rate of return is 6 % and the constant growth rate is 4 %.Compute the stock priceÂ Po.

Â

9.Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â The preferred stock of a corporation pays an annual dividend of $2.50. It has a required rate of return of 5 %. Compute the price of the preferred stock.

Â

10.Â Â Â Â Â Â Â Â Â Â Â Â Â Â A $1,000 par value bond has 7 years to maturity. The bond pays $60 a year in interest and is selling for $900. Given a 30% tax bracket, what is the after tax cost of this debt?

Â

11.Â Â Â Â Â Â Â Â Â Â Â Â Â Â A share of preferred stock is selling for $50 with an estimated floatation cost of $1 per share. It is anticipated that the preferred stock will pay $3 per share in dividends. Compute the cost of the preferred stock to the issuing corporation.

Â

Â

12.Â Â Â Â Â Â Â Â Â Â Â Â Â Â A corporation expects to pay dividends (D1) of $1.40 per share at the end of the current year and the current price of its common stock is $50 per share. The expected growth rate is 5% and floatation costs of $1.00 per share are anticipated. Making use of the constant growth model, compute the cost of this new common equity.

Â

13. Â Â Â Â Making use of the Capital Asset Pricing Model, compute the cost of

Â Â Â Â Â Â Â Â Â Common equity assuming a risk free rate of 2%, a market rate of 5 % and

Â Â Â Â Â Â Â Â An assumed beta of 1.5.

Â

14.Â Â Â Assume the following capital structure:

DebtÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 30%

Preferred stock 20%

Common equityÂ Â Â Â Â Â Â Â Â Â Â 50 %

Â

The following facts are provided:

Â

Bond yield to maturityÂ Â 6%

Corporate tax rateÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 35%

Dividend, Pre.Â StockÂ Â Â Â Â Â Â Â Â Â Â Â Â Â $2.00

Price, Pre. StockÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â $35.00

Floatation, Pre. stockÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â $1.00

Dividend (Do), Com. StockÂ Â Â Â Â $2.00Â

Price, Com. StockÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â $25.00

Growth rate, Com.
StockÂ Â Â Â Â Â Â Â
Â Â Â 4%

Compute the weighted average cost of capital

Â

15.Â Â Please assume the following cash flow data:

Â Â YearÂ Â Â Â Â Â Cash Flow

0Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â - $60,000

1Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 24,000

2Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 36,000

3Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 52,000

Â

Required: Please calculate each of the following:

a.Â Â Â Â Â Â Â The Payback

b.Â Â Â Â Â Â The Internal Rate of Return

c.Â Â Â Â Â Â Â The Net Present Value at an assumed capital cost of 10%.

d.Â Â Â Â Â Â The Modified Internal Rate of Return.

**Solution details:**

ANSWER RATING

This question was answered on:
*Sep 05, 2019*

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free solution (Deadline assured. Flexible pricing. TurnItIn Report provided)

### Other samples, services and questions:

When you use PaperHelp, you save one valuable — TIME

You can spend it for more important things than paper writing.