Question
1.A stock produced total returns of 15%, -12%, 20%, and 36% over the past four years, respectively. What is the geometric average return? 2, A
1.A stock produced total returns of 15%, -12%, 20%, and 36% over the past four years, respectively. What is the geometric average return?
2, A firm is worth $1.500, has a 35% tax rate, total debt of $600, an unlevered return of 15%, and a cost of debt of 7%. What is the cost of equity?
3. Which of the following must be met for a lease to be valid for tax purposes according to the CRA? I. The term of the lease must be less than 90% of the economic life of the asset. II. The lease must have a bargain purchase option, transferring the residual value to the lessee. III. The lease must be primarily for business purposes
4. Al's Audio has a cost of debt of 7 percent, a cost of equity of 11 percent, and a cost of preferred stock of 8 percent. The weight for debt is 0.13, the weight for preferred shares is 0.34, and the weight for common stock is 0.53. The company's tax rate is 34 percent. What is the weighted average cost of capital for Al's Audio Shop?
5. A firm has $500 in debt at a cost of 7%, a 34% tax rate, a total firm value of $1,100, and an unlevered return of 11%. What is the WACC?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started