What is the cost of equity for this firm

Assignment Help Finance Basics
Reference no: EM13288334

The common stock of Modern Interiors has a beta of 1.61 and a standard deviation of 27.4 percent. The market rate of return is 13.2 percent and the risk-free rate is 4.8 percent. What is the cost of equity for this firm?

Reference no: EM13288334

Questions Cloud

What is the drag force exerted on the banner by the air : An airplane pulls a 24 kg banner on a cable as depicted in the figure below. When the plane has a constant cruising velocity the cable makes an angle of ? = 26°. What is the drag force exerted on the banner by the air
Explain the simulation is an ideal gas such as helium : Imagine that the gas shown in the simulation is an ideal gas such as helium. Notice that the final number of moles of gas is 1.00 mol for each experimental run.
Design a combinational-logic subsystem as part of system : In general,dimes should be given before nickels, e.g., if there are at leasttwo diis left, these should be given with a singlenickel, rather than five nickels. There is definitely a possibility that no change can be given before the reservoirs are..
Evaluate the acceleration of the car : A car is traveling down a hill that makes an angle of 13° with the horizontal. The driver applies her brakes, evaluate the acceleration of the car
What is the cost of equity for this firm : The common stock of Modern Interiors has a beta of 1.61 and a standard deviation of 27.4 percent. The market rate of return is 13.2 percent and the risk-free rate is 4.8 percent. What is the cost of equity for this firm?
Explain 5-dimethyl-2 and 6-octadiyne chiral : Is 4,5-dimethyl-2,6-octadiyne chiral. f chiral, give the number(s)(from the IUPAC name) of all chirality center(s) present (increasing numberical order, separated by a comma, no space).
What is the capital structure weight of the firm debt : What is the capital structure weight of the firm's debt if the tax rate is 35 percent?
Find coefficient of kinetic friction between sled and trail : A sled is pulled with a horizontal force of 20 N along a level trail, and the acceleration is found to be 0.35 m/s2. find the coefficient of kinetic friction between the sled and the trail
How high would inflation have to be in order for the balance : How high would inflation have to be in order for the balance of your loan to only be worth a real $50,000, expressed in today's dollars, at the end of 5 years? Express your answer in annually compounding terms.

Reviews

Write a Review

Finance Basics Questions & Answers

  Explain the various methods of stock valuation theory

Various methods of Stock Valuation theory and dividend policies and Stock Valuation: Why does the value of a share of stock depend on dividends?

  What is the value of a put option written on the stock

What is the value of a put option written on the stock with the same exercise price and expiration date as the call option? Round your answer to the nearest cent.

  Refer to recent changes to the discount rate and federal

Refer to recent changes to the discount rate and federal funds rate target made by the Federal Reserve.How do these changes affect you?What happens to borrowers, savers, investors, and bank profits inside and outside the United States as these rat..

  Compute the after-tax cost of purchasing

It would be depreciated under MACRS using a 5-year recovery period. The firm would pay $1,500 per year for a service contract that covers all maintenance costs. There is no salvage value.

  Auditors and their predictions-bankruptcy of client

For discussion purposes counter statement that it is worse for auditors to incorrectly predict bankruptcy than when auditors fail to predict bankruptcy.

  What was the flotation cost as a percentage of funds raised

The initial offering price was $35.10 per share, and the stock rose to $42.40 per share in the first few minutes of trading. Bostitch paid $912,000 in legal and other direct costs and $264,000 in indirect costs.

  What is richards incremental profit

What is Richard's incremental profit if he chooses option 3 over option 2?

  Forward versus spot rate forecast

Forward versus Spot Rate Forecast Assume that interest rate parity exists - forward rate of the Singapore dollar as the forecast or using today's spot rate as the forecast? Briefly describe

  Calculate the total fees you will pay on loan commitment

A loan commitment of $4.36 million has an up-front fee of 65 basis points and a back-end fee of 35 basis points. The take down on the loan is 50 percent. Calculate the total fees you will pay on this loan commitment. (Round your answer to 2 decima..

  Computation of unemployment rate

Computation of unemployment rate and Assume the share of whites in the labour force is 82% and the unemployment rate

  Find the standard deviation of return

Find the standard deviation of this return and show your answer as a percentage to three decimal places

  What is your best estimate of cdbs cost of equity

If the stock sells for $60 per share, what is your best estimate of CDB's cost of equity?

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