What is the value of equity using the fcfe approach

Reference no: EM131975027

Question: Firm B has net income of 500, CAPEX of 200, depreciation of 150, and working capital of 50. All are expected to grow at 3% and the firm is in stable growth. The firm's debt-to-equity (i.e., D/E) ratio is 50%. Its beta is 1, the risk free rate is 5%, and the risk premium is 5.5%. The cost of debt is 6% and the tax rate is 30%. What is the value of its equity using the FCFE approach?

Reference no: EM131975027

Questions Cloud

Deposit each month into account : How much would your parents have to deposit each month into an account that grows at a rate of 10% per year compounded annually

Heights of candidates who won elections : Listed below are the heights of candidates who won elections and the heights of the candidates with the next highest number of votes.

Should the firm purchase the new equipment : A firm believes it can generate an additional $4,800,000 per year in revenues for the next 5 years if it replaces existing equipment that is no longer usable.

Save for vacation : How much will she have to put away at the beginning of each month if the vacation cost is $15,000?

What is the value of equity using the fcfe approach : Firm B has net income of 500, CAPEX of 200, depreciation of 150, and working capital of 50. All are expected to grow at 3% and the firm is in stable growth.

Examine the implications of activity-based costing for wayco : Question: Examine the implications of activity-based costing for Wayco Leisure, and in so doing evaluate the issues raised by each of the directors

What is the firm market capitalization : The company generates $10,000,000 is sales, expenses are $6,000,000. The initial investment of $1,000,000 is depreciated straight-line over 10 years.

Probability that it will have internet access or? cable : If one household from the survey is selected at? random, what is the probability that it will have Internet access or? cable?

How much more in total payments will simon make : How much more in total payments will Simon make under the $20-a-month plan than under the $60-a-month plan.

User Account

All Pages