Expect the company market value to increase

Assignment Help Financial Management
Reference no: EM131552306

In which occasion, can you expect the company’s market value to increase?

1) When the company increases the weight (%) of its owners’ equity in its capital structure by paying out its long-term debt, if all other conditions unchanged.

2) When the company’s WACC decreases, if all other conditions remain the same.

3) When the company’s risk is perceived higher by the investors & creditors, if all other conditions remain the same.

4) When a company continuously invests heavily into its current operations.

Reference no: EM131552306

Questions Cloud

Financial analyst for large metropolitan area transportation : As a financial analyst for a large metropolitan area's transportation authority, What capital budgeting technique should you use to analyze this project?
About the cost of common equity and wacc : What is its cost of common equity and its WACC?
What is after-tax cost of debt : If its marginal the rate is 40%, what is Holmes's after-tax cost of dept?
The importance of financial planning in our daily real life : What is arbitrage? Why do arbitrage opportunities vanish quickly? Explain the importance of financial planning in our daily real life.( in essay format)
Expect the company market value to increase : In which occasion, can you expect the company’s market value to increase?
What are your disbursement-collection and net floats : You have $26, 500 on deposit with no outstanding checks or uncleared deposits. What are your disbursement, collection, and net floats?
Growth rate-maintain to satisfy the entire investors : What is the overall growth rate this company has to maintain to satisfy the entire investors (creditors & shareholders)?
What is risk-free interest rate : What is the risk-free interest rate?
It is likely to be viewed negatively by investors : If a xyz company increases their dividend rate, it’s likely to be viewed negatively by investors.

Reviews

Write a Review

Financial Management Questions & Answers

  Prepare a supplementary schedule of cash flows

What effect will reclassifying the investments have on the current ratio? Is Ross's true finan¬cial position stronger as a result of reclassifying the investments and evaluate Inspireds cash flows for the year.

  What is profit or loss if the price of the stock trades

You obtain the following information concerning a stock, a call option, and a put option. What is the cash inflow or outflow from your position? What is profit or loss if the price of the stock stagnates and trades for $42 after three months? What is..

  Taxable equivalent yields of tax exempt municipal bonds

Consider the following yields on bonds with approximately 20 years to maturity: Calculate the taxable equivalent yields of the tax exempt municipal bonds for the following marginal tax rates: 10%, 15%, 28%, 35%. For which of these tax rates will an i..

  Debt ratio-Gross or net profit margin and EPS

Capture and analyze key ratios/measures and speak to their value as they relate to both the past and expected future growth of the company. Please talk on ratios of ROA, ROE, Debt ratio, Gross or net profit margin and EPS.

  What is the yield on five year corporate bond

An analyst evaluating securities has obtained the following information. The real rate of interest is 3% and is expected to remain constant for the next 5 years. Inflation is expected to be 2.1% next year, 3.1% the following year, 4.1% the third year..

  Find the total amount of interest paid on the note

In the WACC, we use the book value of debt and equity to determine the apporpriate weights on the sources of capital? Find the balace die on the maturity date. Find the total amount of interest paid on the note.

  Bond outstanding with an annual coupon rate

General Mills has a $1,000 par value, 12-year bond outstanding with an annual coupon rate of 3.60 percent per year, paid semi-annually. Market interest rates on similar bonds are 12.70 percent. Calculate the bond's price today.

  How long is financing statement effective

How long is a financing statement effective? How can it be extended? What is the creditor's obligation realted to a filed financing statement once the debt is paid off by the debtor? Upon debtor's default what rights does the creditor have to the col..

  Annual return mean and standard deviation

DW Co. stock has an annual return mean and standard deviation of 12 percent and 33 percent, respectively. What is the smallest expected loss in the coming year with a probability of 5 percent? A stock has an annual return of 11.8 percent and a standa..

  What is his annualized return

Craig purchased 150 shares of Box, Inc. (BOX) when it went public for $14 per share. He wants to sell his shares today, 50-days later, for $18.20 and it paid a $2.13 dividend. What is his annualized return?

  Annual operating cash flow of the new gps system

What is the annual operating cash flow of the new GPS system? What is the NPV of the new GPS system?

  High dividends in order to reinvest more capital into firm

Bubba Seafood currently executes a strategy of not paying high dividends in order to reinvest more capital into the firm.

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