Reference no: EM132781255
Question - You have narrowed your selection down to two choices: Project A and project B. The projects' expected net cash flow are as follows:
|
Expected Net Cash Flow
|
|
Year
|
Project A
|
Project B
|
|
0
|
-375
|
-575
|
|
1
|
-300
|
190
|
|
2
|
-200
|
190
|
|
3
|
-100
|
190
|
|
4
|
600
|
190
|
|
5
|
600
|
190
|
|
6
|
926
|
190
|
|
7
|
-200
|
0
|
1. Assume that the firm has a cost of debt of 7%, a cost of equity of 12%, tax rate of 30%; debt to total assets = 0.4. What is the firm's weighted average cost of capital?
2. Assume that the projects are independent and the WACC is 12%; which project would you choose?
3. Assume that the WACC is 12%; which project would you choose?
4. Assume that the WACC is 18%; which project would you choose?
5. Construct NPV Profile for Project A and B?
6. What is each project IRR? (Based on the IRR, which project would you choose?
7. At a WACC of 12% what is the regular and discounted payback period for these two projects?
8. Assume that the firm's number of outstanding shares is 100, what is the expected change in the stock's price? What are the implicit assumptions that you are making for the expected change to realize?
|
What is the net remittance to be made by dosan corp to dalmi
: DALMI CORP entered into a consignment agreement, What is the net remittance to be made by DOSAN CORP to DALMI CORP as of December 31, 2019?
|
|
Analyze the motivations of the invading country
: The exploitation of colonial resources and indigenous labor was one of the key elements in the success of imperialism. Such exploitation was a result.
|
|
Which the home office failed to
: If the investment in branch account is less than the home office account, the home office failed to? Record a home office expense paid by branch
|
|
How can make such claim considering the brutality of slavery
: In My Bondage and My Freedom, Frederick Douglass argues that slavery was an institution that "victimized" everyone - slaves, slave holders, and non-slave.
|
|
What is the firm weighted average cost of capital
: Assume that the firm has a cost of debt of 7%, a cost of equity of 12%, tax rate of 30%; debt to total assets = 0.4. What is the firm's weighted average cost
|
|
Which freight on shipments to branch paid by the branch
: Which freight on shipments to branch paid by the branch is recorded by the home office as? Under fair value option, non-controlling interest would include
|
|
What can be learned from the era for our own time
: Identify at least one (1) practice in our own time that is similar to those in the 1920s or 1930s (beneficial or damaging). What can be learned from that era.
|
|
Why does god need to rest on the seventh day
: Why does it take God six days to make everything? Why does God need to 'rest' on the Seventh Day? What other interesting things are implied about the ancient.
|
|
Calculate variable overhead spending variance
: Calculate Variable Overhead Spending Variance if actual labor hours used are 360, standard variable overhead rate is $11.40 per direct labor hour
|