User Account

All Pages

What is the wacc of division 3

Assignment Help Finance Basics
Reference no: EM132853800

A firm has a three divisions, Division 1, Division 2, and Division 3. Divisions 1 and 2 represent 32% and 31% of the firm's value, respectively. The firm's WACC is 8.7%, Division 1's WACC is 9.5%, and Division 2's WACC is 6.8%. Neither the divisions, nor the firm as a whole have any debt or preferred stock (i.e.: their capital structures are pure equity). If the risk free rate is 3.8%, and the Market Risk Premium is 6.9%, what is the WACC of Division 3?

Enter your answer as a percentage, without the percent '%' sign, and rounded to 1 decimal.

Reference no: EM132853800

Questions Cloud

Finding the expected shortfall for project : Suppose for a one-year project all outcomes between a loss of $50 million and a gain of $50 million are considered to be equally likely.
Estimate a value of walmart stock : Use concepts learned about present value to estimate a value of Walmart's stock. Note that you will need to estimate the appropriate cost of capital or discount
Maximizing the firm equity value : Assume that the manager's goal is to maximize the firm's equity value. Which project will he choose? Compare your answer to part (b).
Compute the duration and modified duration : Calculate the 2nd year forward rate of a bond security if a one-year bond security YTM is 7% and a two-year bond security YTM is 9%.
What is the wacc of division 3 : If the risk free rate is 3.8%, and the Market Risk Premium is 6.9%, what is the WACC of Division 3?
Finding galaxy corp estimated intrinsic value per share : Galaxy Corp. is expected to generate a free cash flow (FCF) of $9,730.00 million this year (FCF1 = $9,730.00 million), and the FCF is expected to grow at a rate
What is the value of marston preferred stock : Marston Manufacturing Company pays an annual dividend rate of 11.00% on its preferred stock that currently returns 14.74% and has a par value of $100.00 per sha
Compute conversion cost in both departments : Prepare a Production Cost worksheet for the Packaging department - Compute Conversion Cost in both departments
What is the expected dividend yield for portman stock : Portman Industries just paid a dividend of $3.12 per share. The company expects the coming year to be very profitable, and its dividend is expected to grow

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd