What is marys before-tax cost of capital

Assignment Help Business Economics

Reference no: EM13743986

1) Mary Carey, a clever 3360 student, has borrowed $125,000 at 8% from her parents. She is asking Dragon Kevin for $75,000 to start her own business. Kevin requires that the business make a 12% rate of return. If they both agree, what is Mary's before-tax cost of capital? Answer as a number like 12.3 which means 12.3%

2) If Mary has to pay 30% taxes, what is her cost of capital AFTER taxes? Answer as above.

Reference no: EM13743986

Questions Cloud

Increase government expenditure : Suppose the Council of Economic Advisors (CEA) hired you as an Economist (Economic consultant). The head of the council tells that she believes the current unemployment rate of 9% is too high. They would like to increase real aggregate output (RGDP).

Prepare the income statement for 2013 : Transaction spreadsheet for 2013 using the data of events for 2013 identified as 1-10 and the additional information a-d and prepare the Income Statement for 2013 - Prepare the statement of shareholders' equity, balance sheet, and statement of cash f..

What weighting you think should be used in devising ranking : What considerations, measures, and weightings do you think should be used in devising such rankings? Use your method to devise a ranking of the top three political states in a century of your choice before the twentieth.

Assignment on my role as an effective collaborator : Creating a Team Charter is only the first step in this process, however. In order to consider you as a candidate for a position on their model team, WCI also requires that you submit an up-to-date resume and a cover letter.

What is marys before-tax cost of capital : Mary Carey, a clever 3360 student, has borrowed $125,000 at 8% from her parents. She is asking Dragon Kevin for $75,000 to start her own business. Kevin requires that the business make a 12% rate of return. If they both agree, what is Mary's before-t..

Use as first cost of defender in a replacement analysis : Which of the following is the proper value to use as the " first cost" of the defender in a replacement analysis? Which of the following is a replacement repeatability assumption? When conducting a replacement analysis, which of the following equals..

Describe the status of the latin americans : describe the status of the Latin Americans or idea and how that group or idea was affected by the changes brought about during the 1960s.

Different tools of fiscal policy to stabilize the economy : Give an example of an event or incident that has taken place in the U.S. economy which has a major economic impact--be specific, e.g., 9/11 attack, natural disaster, rise or fall in oil prices due to OPEC policies, consumer optimism or pessimism abou..

Describe how nonverbal feedback conveys powerful messages : Describe how nonverbal feedback conveys powerful messages. Provide an example where nonverbal feedback was used and describe the end result.

User Account

All Pages