43.Sporting goods company CFO wants to maintain a target debt to equity ratio of 1/2. If the weighted average cost of capital is10.575% and the pre-tax cost of debt is 8% what is the cost of common equity assuming a tax rate of 40%? (show all work)

44. Blinky Company is considering two equally risky, mutually exclusiveprojects, Projects A and B, that have the following cash flows: Year //Project A //Project B 0 //-$100,000 //-$100,000 1 //40,000 // 30,000 2 //25,000 //15,000

3 //70,000 //80,000 4//40,000 //55,000

What is the cost of capital that would make these two projects have the same NPV? Why would the cost of capital influence your decision to take Project A or B based off NPV versus IRR method? (show work in excel) 47.Elliot Athletics is trying to determine its optimal capitalstructure, which now consists of only debt and common equity. To estimatehow much debt would cost at different debt levels, the company treasury staff has consulted with investment bankers and, on thebasis of those discussions, has created the following table:

Debt/Assets	Equity/Assets	Debt/Equity	Debt	Cost of debt (%)
Ratio (wd)	Ratio (wc)	Ratio (D/E)	Rating
0.25	0.75	0.33	A	7.50%
0.35	0.65	0.5385	BBB	8.40%
0.50	0.50	1.00	BB	9.00%

Elliott uses the CAPM to estimate its cost of common equity, ks. The company estimates that the

risk-free rate is 5 percent, the market risk premium is 6 percent, and its tax rate is 35percent.

Elliott estimates that if it had 10% debt it's beta would be 1.0. What is the companies optimal capital structure? What is the firms cost of capital at this optimal capital structure? (solve in excel)

49.A firm is considering Projects S and L, whose cash flows are shownbelow. These projects are mutually exclusive, equally risky, and not repeatable. The CEO wants to use the discounted payback period and Modified IRR (MIRR)criterion, the cost of capital is 15%. which project would you take? (show in excel) ...............0 //1 //2 //3 //4 CFS:-$2,050 // $670 //$-70 //$680 //$695 CFL:-$2,150 // $1,000//$-100//$1,300//$1,200