1. A. Kennedy Air Services is now in the final year of a project. The equipment originally cost $20 million, of which 90% has been depreciated. Kennedy can sell the used equipment today for $6 million, and its tax rate is 30%. What is the equipments after-tax salvage value?

1. B.

Eh Systems is considering a project with the following cash flows. Whats its MIRR?

1. C.

A companys weighted average cost of capital is 11% per year. A project requires an investment cost of $4,800 today and it is expected to generate free cash flows of $2,000 per year for the next five years. What is the projects equivalent annual annuity (EAA)?

1. D.

Percy Motors has a target capital structure of 40% debt and 60% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 9%, and its tax rate is 40%. Percy's CFO estimates that the company's WACC is 10.96%. What is Percy's cost of common equity?