Company acceptable minimum return on capital

Assignment Help Finance Basics
Reference no: EM131049790

A company's acceptable minimum return on capital (i.e., WACC) is 12%. If the debt/equity ratio is 1:1, and the after-tax cost of debt is 5% (the company is in the 40% tax baracket), what is the corresponding minimum acceptable return on equity?

Reference no: EM131049790

Questions Cloud

Question regarding the concepts reflection : Analyze the online instruction manual for a home appliance, or locate an online manual for a similar product. Answer the following questions in your analysis:
Beginning retained earnings-net income-dividends : Carlos Ramirez and Camila Garza organized New World Book Store as a corporation; each contributed $70,900 cash to start the business and received 5,200 shares of common stock. What was the amount of net income for the year? (Hint: Use the retained ea..
Verify that the derivatives matrix is given by equation : verify that the derivatives matrix is given by Equation
Briefly describe the article marriage by the numbers : Explain & provide specific examples of how media acts as an agent of gender development. Briefly describe the article, "Marriage by the Numbers" and its relevancy to the "Don't be Happy, Worry" article.
Company acceptable minimum return on capital : A company's acceptable minimum return on capital (i.e., WACC) is 12%. If the debt/equity ratio is 1:1, and the after-tax cost of debt is 5% (the company is in the 40% tax baracket), what is the corresponding minimum acceptable return on equity?
Prove that this decomposition is unique : An important tool in the development of the strain tensor was the decomposition (16.79) of a matrix M into its anti-symmetric and symmetric parts. Prove that this decomposition is unique.
Design and develop a new set of courses : Professor Xavier wants to design and develop a new set of courses, all with the goal of helping students learn more about set theory and algebra; probably five or six courses altogether.
What is estimate of current stock price-target stock price : Sully Corp. currently has an EPS of $2.27, and the benchmark PE ratio for the company is 23. Earnings are expected to grow at 5.5 percent per year. What is your estimate of the current stock price? What is the target stock price in one year?
Explain differences between technical and academic writing : Differences Between Technical and Academic Writing. How do you distinguish the research goals of technical writing versus academic writing? Share examples from your own professional and academic lives.

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd