Determine what is the after-tax cost of preferred stock

Assignment Help Financial Econometrics
Reference no: EM13335756

A firm's preferred stock pays an annual dividend of $4, and the stock sells for $80. Flotation costs for new issuances of preferred stock are 5% of the stock value. What is the after-tax cost of preferred stock if the firm's tax rate is 30%?

Reference no: EM13335756

Questions Cloud

Determine what is the projects year 0 net cash flow : Keiper, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.7 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be wo..
What is the angle between the protons velocity and the field : A proton moving at 4.30 106 m/s through a magnetic field of 1.75 T experiences a magnetic force of magnitude 8.04 10-13 N
What is the rms current supplied by the generator : a 5 mf capacitor and a 9 mf capacitor are connected in parallel to a 60 hz generator operating with an rms voltage of 120 v
Determine what is the internal rate of return for a project : What is the internal rate of return for a project that has a net investment of $60,000 and the following net cash flows: Year 1 = $15,000; Year 2 = $20,000; Year 3 = $25,000; Year 4 = $30,000
Determine what is the after-tax cost of preferred stock : A firm's preferred stock pays an annual dividend of $4, and the stock sells for $80. Flotation costs for new issuances of preferred stock are 5% of the stock value.
Calculate the projects initial time zero cash flow : In five years, the aftertax value of the land will be $5.7 million, but the company expects to keep the land for a future project. The company wants to build its new manufacturing plant on this land
Designed to efficently manage a consumer b2c website : A virtual organization is often designed to efficently manage a consumer (B2C) website
What is the diameter of the camaras aperture : a police camera is designed to read the plate number on a speeding car. what is the diameter of the camara's aperture
What is the pressure at the narrow end of the segment : A horizontal segment of pipe tapers from a cross sectional area of 50 cm2 to 0.5 cm2. What is the pressure at the narrow end of the segment

Reviews

Write a Review

Financial Econometrics Questions & Answers

  What do you think should be the outcome of wooden pallets

Sony Corp. packed a shipment of videocassette tapes into a 40-foot ocean container for transport to England. Sony put the tapes into 1,320 cardboard cartons, then strapped the cartons onto fifty two wooden pallets.

  Determine what is the current price of bond m and bond n

Bond N also has a face value of $40,000 and a maturity of 20 years; it makes no coupon payments over the life of the bond. The required return on both these bonds is 8 percent compounded semiannually.

  Determine what is the firms expected rate of return

dothan inc.'s stock has a 25% chance of producing a 17% return, a 50% chance of producing a 12% return, and a 25% chance of producing a -18% return. what is the firm's expected rate of return

  How much would state liability for each of families change

Analyze the implications of credit on two families of this state: Family #1 (in the 18 percent federal tax bracket) and Family #2 (in the 35 percent federal tax bracket), each family expends approximately $1,500 per year for child-care.

  Determine what is the sustainable rate of growth

Stop and Go has a 5 percent profit margin and a 44 percent dividend payout ratio. The total asset turnover is 1.66 and the debt-equity ratio is .50. What is the sustainable rate of growth

  Will any of pats wages be exempt from social security

Pat Maninen earns a gross salary of $2,100 each week. Assume a rate of 6.2% on $106,800 for Social Security and 1.45% for Medicare. What are Pat's first week's deductions for Social Security and Medicare

  What is the overall rate of return on the portfolio

One year ago, an American investor bought 1000 shares of London Bridges at a price of £22 (or 22 UK pounds) per share when the exchange rate was $1.5/1£ (or $1.50 dollars = 1 pound).

  What is internal rate of return of initial cost of project

Miller Brothers is considering a project that will produce cash inflows of $61,500, $72,800, $84,600, and $68,000 a year for the next four years, respectively. What is the internal rate of return if the initial cost of the project is $225,000

  Calculate tbar-t of equated time approximates by tbar

A payment of $10 at time 1 and a payment of $20 at time 4 is equivalent to a payment of $30 at time t assuming a constant force of interest delta = .05.

  Determine what proceeds did sheffield company receive

On September 4, Sheffield Company discounted at Sunshine Bank a $9,000 (maturity value), 120-day note dated June 4. Sunshine's discount rate was 7.50%.

  Determine what are operating cash flows in the first year

The Old machine originally cost $ 363 and was bought Three (3) years ago (i.e. it has depreciated for three years). It could be sold today for $ 78 or sold in two years for $ 26 . The New machine would cost $ 467 and could be sold in two years for..

  What is the principal repayment on the 20th payment

To finance the purchase, you have arranged for a 30-year mortgage loan for 80 percent of the $2,800,000 purchase price. The monthly payment on the loan will be $22,000.

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