Target debt-equity ratio, Benjamin Manufacturing has a

Target debt-equity ratio

Assignment Help Financial Management

Reference no: EM13917671

Benjamin Manufacturing has a target debt-equity ratio of .61. Its cost of equity is 14.4 percent, and its cost of debt is 9.4 percent.

Reference no: EM13917671

Questions Cloud

What is the monthly financing cost : If the inventory costs $12 per unit and will be financed at the bank at a cost of 12 percent, what is the monthly financing cost and the total for the four months? (Use 1.0 percent as the monthly rate.)

Equal weighting scheme to an optimal weighting scheme : An investor has designed a risky portfolio based on two stocks, A and B. The standard deviation of return on stock A is 20% while the standard deviation on stock B is 30%. The correlation coefficient between the return on A and B is 0.25. If the inve..

What rate of return should investors require on this fund : Assume that you are the portfolio manager of the SF Fund, that contains the following stocks. The required rate of return on the market is 11.00% and the risk-free rate is 5.00%. What rate of return should investors require on this fund? Amount Beta ..

Arithmetic return and geometric return : An asset has had an arithmetic return of 10.8 percent and a geometric return of 8.8 percent over the last 86 years. What return would you estimate for this asset over the next 7 years? 21 years? 28 years?

Target debt-equity ratio : Benjamin Manufacturing has a target debt-equity ratio of .61. Its cost of equity is 14.4 percent, and its cost of debt is 9.4 percent.

Treasury security-disregard cross-product terms : Suppose the real risk-free rate is 4.20%, the average expected future inflation rate is 3.10%, and a maturity risk premium of 0.10% per year to maturity applies, i.e., MRP = 0.10%(t), where t is the number of years to maturity, hence the pure expecta..

Allocate the joint costs using the relative sales values : Landmark Coal operates a mine. During July, the company obtained 500 tons of ore, which yielded 250 pounds of gold and 62,500 pounds of copper. The joint cost related to the operation was $500,000. Gold sells for $325 per ounce and copper sells for $..

What was the bond current yield : Consider the following information form September 15th, 2012 for a coupon bond with face valueof $1000 and maturity on September 15th, 2014: What was the bond current yield? Why is the bond's yield to maturity greater than its coupon rate?

The bond become more attractive to investors : "If interest rates rise, the bond become more attractive to investors, so bond prices rise. Therefore, when the interest rates rise, bond prices will also rise" Your investment advisor has just given you the following advice: "Long-term bonds are a g..

User Account

All Pages