What is the interest rate on the? debt

Assignment Help Business Economics
Reference no: EM131670107

Hubbard Industries is an? all-equity firm whose shares have an expected return of 9.9%

Hubbard does a leveraged? recapitalization, issuing debt and repurchasing? stock, until its? debt-equity ratio is 0.54

Due to the increased? risk, shareholders now expect a return of 14.5 %

Assuming there are no taxes and? Hubbard's debt is? risk-free, what is the interest rate on the? debt?

Reference no: EM131670107

Questions Cloud

Describe the roles and settings of addiction counselors : Can you describe any principles, models, and documentation formats of biopsychosocial case conceptualization and treatment planning?
Why do lenders often refuse to finance of a purchase : Why do lenders often refuse to finance 100 percent of the cost of a purchase, requiring borrowers to make a down payment that covers a portion.
Evaluating a project with the cash flows : Mittuch Corp. is evaluating a project with the following cash flows. The company uses a discount rate of 12 percent and a reinvestment rate of 9 percent.
Discuss about the brain structures or systems : Choose 3 activities, and for each activity, choose 3 brain structures (or systems) for a total of 9 structures.
What is the interest rate on the? debt : Assuming there are no taxes and? Hubbard's debt is? risk-free, what is the interest rate on the? debt?
Ethical considerations of the budget projections : Ethical Considerations. Budget projections always involve a degree of judgment because managers can never predict the future with total accuracy.
What is the net income of the firm for the year : a. What is the net income of the firm for the year?
Calculate effective annual interest rate : A three-year bank CD paying 7.05 percent compounded monthly. Calculate effective annual interest rate (EAR)?
What should you do in the ipo case : The company you cofounded last year is growing rapidly and has strong prospects for an IPO in the next year or two. The additional capital that an IPO.

Reviews

Write a Review

Business Economics Questions & Answers

  Identify the effect on the market for coal and mention

In each case below, please identify the effect on the market for coal and mention briefly the mechanism yielding to this effect.

  Using a two-dimensional diagram of supply and demand

Using a two-dimensional diagram of supply and demand, Illustrate the case of a supply cooperative maximizing net revenue in the short-run. a) What is the optimization criterion for determining the quantity supplied by the cooperative? b) Label the pr..

  Describe the general characteristics of oligopolies

Describe the general characteristics of oligopolies. Describe the economic characteristics unique to the airlines

  Estimate the cost to purchase the new equipment

A company purchased a piece of equipment 10 years ago for $10,000. They are trying to purchase a similar type of equipment now The old equipment had a capacity of 2,000 units, white the new one has a capacity of 1,000 units The power sizing exponent ..

  Benefit-cost ratio analysis-upgrading athletic facilities

Cornell has two options for upgrading their athletic facilities. The off campus option costs only $20 million, but it will require frequent bus service to those facilities at an annual cost that starts at $300,000 and increases by 4% per year.

  The money supply in the fictitious nation

For the last several years, the money supply in the fictitious nation of Mauritania has been rising by 10% annually, and inflation has been running at 8%. The central bank is going to cut growth of the money supply back to 3% annually. Which of the f..

  If monopolist lowers its price and its demand is inelastic

If a monopolist lowers its price and its demand is inelastic, then its. Now, assume there is a frost in Florida that destroys part of the orange crop. What happens to the market for oranges in this case? Which of the following statement about the rel..

  DOT is performing benefit-cost analysis of new highway

A DOT is performing a benefit-cost analysis of a new highway using an analysis period of 40 years as part the required environmental impact assessment of the project. The section of highway is estimated to have a construction cost $260 million dollar..

  There is an increase in the number of buyers of good

There is an increase in the number of buyers of good X. As a result, the _____________ curve for good X will shift ____________ resulting in a(n) _____________ in the equilibrium price of X and a(n) ____________ in the equilibrium quantity of X.

  Result in an increase in the quantity demanded

Since a decrease in the price of 1 unit along a linear demand curve will result in an increase in the quantity demanded by a constant amount, the price elasticity is constant for all quantities along a linear demand. True or False & Explain

  How could one use ethical principles to address their budget

XYZ School District is having budget issues and is facing the possibility of cutting some programs. How could one use ethical principles to address their budget issues?

  Compares the contemporary u.s. economy

If one compares the contemporary U.S. economy with those of Germany and France, it is reasonable to conclude that

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