Estimate the firm cost of internal equity

Assignment Help Finance Basics
Reference no: EM133004681

Nine Point Industries has a beta of 0.98 and a marginal tax rate of 21%. The expected return on the market is 16% and the return on a Treasury security is 2.67%. Estimate the firm's cost of internal equity.

Reference no: EM133004681

Questions Cloud

How many units do they need to produce : If the company budgets to need 4000 units to sell for a month, has a beginning inventory of 1000 units, how many units do they need to produce
What is the intrinsic value of the option : XYZ is trading at $100, a 6 month call option on XYZ struck at $90 is priced at $15. 6 month LIBOR is 3% per annum and XYZ has a 1% per annum dividend yield.
What is the interest expense to be recognized : The discounting is accounted for as a secured borrowing. What is the interest expense to be recognized on the date of discounting
Find the equivalent effective daily rate : Given an effective semi-annually rate of 0.91250%, find the equivalent effective daily rate. (You might need to keep more than the usual number)
Estimate the firm cost of internal equity : Nine Point Industries has a beta of 0.98 and a marginal tax rate of 21%. The expected return on the market is 16% and the return on a Treasury security is 2.67%
What is the balance in cash at february : During February 2018, its first month of operations, Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?
What is the current price for this share : John West is interested in buying shares in Appen Ltd. which is growing at a constant rate of 10 per cent. What is the current price for this share
What is the initial cost of the project : The Dow Chemical has a debt-equity ratio of .7 The firm is analyzing a new project that requires aninitial cash outlay of $210,000 for equipment. The flotation
Discuss the hedging method the british firm may use : Option contracts are available for the EUR/GBP currency pair. Critically discuss the choice of option based on type, strike and expiry date to hedge

Reviews

Write a Review

Finance Basics Questions & Answers

  How many interest payments remain

You want to know how many more interest payments you will receive, but the party selling the bond cannot remember.

  How do high watermark provision benefit

What is the standard hedge fund (HF) compensation structure and how do high watermark provision benefit or impose costs on HF investors?

  A particular test for the presence of steroids is to be

a particular test for the presence of steroids is to be used after a professional track meet. if steroids are present

  Explain capital budgeting involves calculation of npv

Explain Capital budgeting involves calculation of IRR, NPV, Payback period and If the required return is greater than the coupon rate

  Dynamic effects of economic integration

Explain the static effects and dynamic effects of economic integration. What is the difference between trade creation and trade diversion resulting

  Make a schedule of cash receipts for usa apparel

Make a schedule of cash receipts for USA Apparel covering the fourth quarter (October through December). For each of those three months

  What are the post-merger earnings per share

What are the post-merger earnings per share? What is the maximum number of new shares that must be issued to Doodle stockholders? If Dipsy decides to pay $30 per share for Doodle, what would be the exchange ratio?

  What is the return on equity for each firm

What is the return on equity for each firm if the interest rate on current liabilities is12% and the rate on long-term debt is 15%?

  Use the empirical rule to determine the following a about

the mean amount of money that a family of four will spend on a baseball game including the food and souvenirs is 195

  What is the present value cost of the scholarship

Beginning at the end of this year and continuing indefinitely each year after, a school scholarhsip will pay a different student $6000 a year.

  Explain the specific public health laws

Explain the specific public health laws, policies, and regulations related to the programs that combat the Cryptosporidiosis pathogen.

  What is the discount factor

An investment costs $1,548 and pays $138 in perpetuity. If the interest rate is 9%, what is the NPV? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.)

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