Mathematics, 26.10.2021 21:30 mchillery1028
Company X has the following capital structure, which it considers to be optimal:
Debt =33%, Preferred stock = 28%, Common equity = 39%
Company X’s tax rate is 25% and investors expect earnings and dividends to grow at a constant rate of 6.5% in the future. Company X is expected to pay a dividend of $4.40 per share next year, and its stock currently sells at a price of $55 per share.
Company X can obtain new capital in the following ways:
Preferred: New preferred stock with a dividend of $13 can be sold to the public at a price of $109 per share.
Debt: Debt can be sold at an interest rate of 11%.
Calculate the following:
a. Cost of Common equity?
b. Cost of Preferred Equity?
c. Cost of debt?
d. Weighted Average Cost of Capital (WACC)
Answers: 3
Mathematics, 22.06.2019 00:10
Which of the following expressions cannot be simplified to x – 2?
Answers: 1
Mathematics, 22.06.2019 00:30
Taber invested money in an account where interest is compounded every year.he made no withdrawals or deposits. the function a(t)=525(1+0.05)^t represent the amount of money in the account after t years. how much money did taber origanally invested?
Answers: 1
Company X has the following capital structure, which it considers to be optimal:
Debt =33%, Prefer...
History, 04.09.2020 20:01
Physics, 04.09.2020 20:01
Spanish, 04.09.2020 20:01
History, 04.09.2020 20:01
Social Studies, 04.09.2020 20:01
Biology, 04.09.2020 20:01
Biology, 04.09.2020 20:01
Mathematics, 04.09.2020 20:01
Mathematics, 04.09.2020 20:01
Social Studies, 04.09.2020 20:01