Answered step by step
Verified Expert Solution
Question
1 Approved Answer
47. Suppose you have the following information for the Vanilla Bean company for 2021: - Required Return on Equity of 10.00%. - Tax Rate of
47. Suppose you have the following information for the Vanilla Bean company for 2021: - Required Return on Equity of 10.00%. - Tax Rate of 30%. - Cost of Debt of 7.00\%. - Book Value of Equity of $15 billion. - Long-Term Debt of $5 billion. The firm's Risk Adjusted Opportunity Cost of Capital (RAOCC) is A. 14.00% B. 13.50% C. 8.75% D. 8.50% 48. Vanilla Bean company also reports for 2021 : - Operating Profit of $4 billion. - Taxes of $120 million. Vanilla Bean's NOPAT is , and its ROIC is A. $2 billion; 20% (B. $3.88 billion; 19.40% C. $1.5 billion; 24.50% D. $2 billion; 8.75%. 49. The Vanilla Bean company's Economic Value Added (EVA) is A. $5.34 billion B. $3.88 billion C. \$2.12 billion D. $4.08 billion. 50. From a stockholder's perspectivea firm with exceptional growth opportunities, where the ROIC on new investments significantly exceeds the ROACC on the new investments should A. Increase its dividend payout ratio. B. Maintain its current dividend payout ratio. C. Lower its dividend payout ratio. D. None of the above
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