User Account

All Pages

How would that ratio change if the firm

Assignment Help Finance Basics
Reference no: EM13945519

Start-Up Industries is a new firm that has raised $200 million by selling shares of stock. Management plans to earn a 24% rate of return on equity, which is more than the 15%rate of return available on comparable-risk investments. Half of all earnings will be reinvested in the firm. 

a. What will be Start-Up's ratio of market value to book value?

b. How would that ratio change if the firm can earn only a 10% rate of return on its investments?

Amount raised......$200.00 million
Return on equity.....24.00%
Rate of return......15.00%
Plow back ratio........50.00%
Rate on equity (b) ....10.00%

Reference no: EM13945519

Questions Cloud

Economical sustainable solar charging substitutes : Design economical sustainable solar charging substitutes to the universities current method. This applies to both applications for university golf carts and student use on campus.
Skill for example improving reading comprehension : Design a program or study to addressed skill for example improving reading comprehension just design it not implement it for now I need just the research topic and abstract purpose
How much energy is required to heat 73g : At 1 atm, how much energy is required to heat 73.0 g of H2O(s) at -20.0 °C to H2O(g) at 133.0 °C?
Define federalism and its advantages and disadvantages : Research federalism using your textbook and the Internet. Write a paper on federalism. Structure your paper as follows: Define federalism. Explain three advantages of federalism. Explain three disadvantages of federalism
How would that ratio change if the firm : How would that ratio change if the firm can earn only a 10% rate of return on its investments?
Error code in unning this program in raptor : I need an input statement that would allow the user to input any day of the week for steps walked and be able to input any number for step walked on any day of the week.
Write a short note on probability sampling methods : What techniques would you suggest in an effort to minimize and detect subject dishonesty in a Social Science research? Write a short note on probability and non-probability sampling methods
How should the interests of competing groups be balanced : Should environmental groups play a role in preserving those regions threatened by human encroachment, even if it is jeopardizing interests of the economic growth? How should the interests of competing groups be balanced?
Implement the following pseudocode : private static ArrayList board = new ArrayList ();

Reviews

Write a Review

Finance Basics Questions & Answers

  Borrowing the amount she still owes on the car

Two years ago Abilia purchased a $13,000 car; she paid $2,500 down and borrowed the rest. She took a fixed rate 60-month installment loan at a stated rate of 7.0% per year. Interest rates have fallen during the last two years and she can refinance he..

  What is the expected return and standard deviation

If there are no restrictions on short sales or borrowing, what is the expected return and standard deviation on the portfolio of these two assets if they are invested half in A and half in B?

  Creative solutions inc has a successful brand with the name

creative solutions inc. has a successful brand with the name top goal. the market size in which top goal competes is 2

  Aresearcher reports an f-ratio with df 1 24 for an

a researcher reports an f-ratio with df 1 24 for an independent-measures experiment. how many individual subjects

  What is the present value of a five-year lease arrangement

What is the present value of a five-year lease arrangement with an interest rate of 9% that requires annual payments of $10,000 per year with the first payment being due now?

  Difference in total annual cost

The manager has suggested a "round number" order size of 800 boxes. The manager's rationale is that with a U-shaped cost curve that is fairly flat at its minimum, the difference in total annual cost between 800 and 801 units would be small anyway...

  Options for purchasing a new vehicle

The code enforcement unit of a public safety department has two options for purchasing a new vehicle: a $23,000 four-cylinder sedan that averages 26 mpg or a $28,000 hybrid that averages 47 mpg.

  How many new retail outlets would be necessary to break

A final suggestion is a make a 10% across-the-board price reduction. By how much would dollar sales have to increase to maintain Alliance's current contribution.

  Equipment for producing hot dogs

The Friendly Sausage Factory (FSF) can produce hot dogs at a rate of 5,000 per day. FSF supplies hot dogs to local restaurants at a steady rate of 270 per day. The cost to prepare the equipment for producing hot dogs is $66. Annual holding costs a..

  An investor deposits rs100000 today in a bank and bank

an investor deposits rs.100000 today in a bank and bank offers 5 interest rate per annum compounded quarterly. what

  What is the net amount received by the corporation

what is the net amount received by the corporation if it acts rationally?

  What is the net unrealized holding gain or loss

When the equity method is used to account for investments in common stock, which of the following affect(s) the investor's reported investment income?

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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