1) A:

Given the data below about Vogels Capital Structure and the Rate of Return demanded by each resource, compute (rounded up to one-tenth of one percent, i.e.; 13.653 = 13.7%) the Weighted Average Cost of Capital for The Vogel Company:

1) B:

Given my calculation for Vogels WACC, I have conservatively chosen a THRESHOLD RATE FOR CAPITAL FUNDS CALCULATIONS TO BE at least 2% points higher than the WACC and rounded up to the next full percentage point. For example, if my calculated WACC was 8.3%, the Threshold Rate would be 10.3% and then rounded up to 11% . I realize that for this exercise, the maximum THRESHOLD RATE can be no higher than 25%.

RELATIVE REQUIRED RATE THIS SOURCE 16 SOURCE OF CAPITAIL PERCENTAGE OF oF RETURN FROM INSERT NUMBERS HERE CAPITAL FROM THIS SOURCE (in percentage rate EQUITY STOCK BANK BORROWING FINANCIAL BONDS 30% 35% 35% 100% 13 Weighted Average Cost TOTAL CAPITAL of Capital (WACC) = I have computed the Vogel'sWACC to be-INSERT A NUMBER HERE 00 Therefore, I have selected this Threshold Rate: INSERT A NUMBER HERE 0