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1. Firm ABC has a current capital structure of $45.3M in Common Stock and $18.3M in Coupon Bonds. The bonds have a YTM of 6.4%
1. Firm ABC has a current capital structure of $45.3M in Common Stock and $18.3M in Coupon Bonds. The bonds have a YTM of 6.4% and firm has a tax rate of 21%. If the firm calculates a WACC of 7.2%, what is the cost of common stock? 6.94% b. 8.07% C. 10.24% d. 7.52% a. 2. Two years ago, you bought 200 shares of Stock XYY at $84.25 per share. During the first year, it paid a dividend of $.15 per quarter. During the second year, it paid a dividend of $.22 per quarter. If you sold it today at a price of $78.24, what is your dollar return? a. $-906 b. $1,498 c. $-497 d. $835 3. Over the past three years, you have had returns of 5.4%, 7.2%, and -11.9%, in years 1-3 respectively. If you started (three years ago), with $17,000, how much do you have now? a. $16,922 b. $17,119 c. $24,241 d. $11,341
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