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1) Calculate NOPAT for 2014 and 2015. $45,000 and $50,000 respectively was considered to be a reinvestment for the future growth of the firm. 2)
1) Calculate NOPAT for 2014 and 2015. $45,000 and $50,000 respectively was considered to be a reinvestment for the future growth of the firm.
2) Calculate the relative proportions of debt and equity in tje companys captial structure for 2014 and 2015
3) Calculate the cost of debt and equity if:
Prime rate = 7% per year
Bank charges prime + 2% for commercial loans
the company is in the 40% tax bracket
Ten year notes currently yield 5% and the risk premium of equity is 8%
4) Calculate EVA for both years and explain what it indicates about the company performance.
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