Explain the expected rate of return, Operation Management

Assignment Help:

Debt: Jones Industries borrows $600,000 for 10 years with an annual payment of $100,000. What is the expected interest rate (cost of debt)?

Internal common stock: Jones Industries has a beta of 1.39. The risk-free rate as measured by the rate on short-term US Treasury bill is 3 percent, and the expected return on the overall market is 12 percent. Determine the expected rate of return on Jones's stock (cost of equity). Here are the details:

Jones Total Assets

$2,000,000

Long- & short-term debt

$600,000

Common internal stock equity

$400,000

New common stock equity

$1,000,000

Total liabilities & equity

$2,000,000


Related Discussions:- Explain the expected rate of return

Calculate seasonal index for all quarter, The number of visitors at a theme...

The number of visitors at a theme park by season and year has been recorded and is given in the following table: Quarter 2003 2004 2005 2006 Winter 45 46 35 16 Spr

Explain one test of whether marketing research, One test of whether marketi...

One test of whether marketing research should be done is whether different outcomes will lead to different marketing actions. whether different outcomes will lead to the

Airline implementing a policy that need to buy second seat, Answer the foll...

Answer the following questions: 1. what are the pros and cons of an airline implementing a policy that heavier customers need to buy a second seat? Research an airline and provide

Explain long-term relationship between the inventory, The long-term relatio...

The long-term relationship between the inventory, throughput, and flow time of a production system in steady state is called which of the following?

Column minima method, Column Minima Method: Step 1: Determine  the  ...

Column Minima Method: Step 1: Determine  the  smallest cost in  the first  column  of the  transportation  table. Let it be  C1j  . allocate  Xi1= min ( ai bi ) in the cell

Value of a Loyal Customer (VLC), A manufacturer of business copier workstat...

A manufacturer of business copier workstations has a 75 percent customer retention rate. Their accounting department estimates the incremental contribution to profit and overhead

Explain the chocolate raw material safety stock christian, Christian runs a...

Christian runs a small chocolate shop. He manages his chocolate raw material using a periodic review system. Daily demand has a mean of 100 pounds and standard deviation of 10 poun

Explain description of the purpose of prototyping, A description of the art...

A description of the article and where it was found Identification of the one thing about prototyping that surprised you the most A brief summary of why it surprised you A descript

Explain decision alternatices and various levels of demand, The following p...

The following payoff table provides profits based on various possible decision alternatices and various levels of demand at Amber Gardner's software firm

Explain services from goods, Which of the following is not a characteristic...

Which of the following is not a characteristic that distinguishes services from goods? Service jobs are unskilled A service is intangible Services are perishable Services are heter

Write Your Message!

Captcha
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