Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines This new equipment, the RGM 7000, will allow Caspian Sea Drinks to expand production It will cost $15 00 million fully installed and will be fully depreciated over a 15 00 year life, then removed for no cost The RGM 7000 will result in additional revenues of $2 84 million per year and increased operating costs of $716,131 00 per year Caspian Sea Drinks' marginal tax rate is 20 00 The incremental cash flows for produced by the RGM 7000 are ROUND TO 2 DECIMAL PLACES Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines This new equipment, the RGM 7000, will allow Caspian Sea Drinks to expand production It will cost $13 00 million fully installed and will be fully depreciated over a 16 00 year life, then removed for no cost The RGM 7000 will result in additional revenues of $3 04 million per year and increased operating costs of $697,823 00 per year Caspian Sea Drinks' marginal tax rate is 31 00 The incremental cash flows for produced by the RGM 7000 are ROUND TO 2 DECIMAL PLACES Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines This new equipment, the RGM 7000, will allow Caspian Sea Drinks to expand production It will cost $13 00 million fully installed and will be fully depreciated over a 15 year life, then removed for no cost The RGM 7000 will result in additional revenues of $3 20 million per year and increased operating costs of $693,330 00 per year Caspian Sea Drinks' marginal tax rate is 29 00 The internal rate of return for the RGM 7000 is ROUND TO 4 DECIMAL PLACES Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines This new equipment, the RGM 7000, will allow Caspian Sea Drinks to expand production It will cost $12 00 million fully installed and will be fully depreciated over a 20 year life, then removed for no cost The RGM 7000 will result in additional revenues of $2 83 million per year and increased operating costs of $651,480 00 per year Caspian Sea Drinks' marginal tax rate is 35 00 If Caspian Sea Drinks uses a 10 00 discount rate, then the net present value of the RGM 7000 is ROUND TO 2 DECIMAL PLACES Caspian Sea Drinks' is financed with 68 00 equity and the remainder in debt They have 11 00 year, semi annual pay, 5 57 coupon bonds which sell for 98 41 of par Their stock currently has a market value of $25 41 and Mr Bensen believes the market estimates that dividends will grow at 3 74 forever Next year's dividend is projected to be $2 11 Assuming a marginal tax rate of 27 00 , what is their WACC (weighted average cost of capital) ROUND TO 2 DECIMAL PLACES

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Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow

Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $15.00 million fully installed and will be fully depreciated over a 15.00 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.84 million per year and increased operating costs of $716,131.00 per year. Caspian Sea Drinks' marginal tax rate is 20.00%. The incremental cash flows for produced by the RGM-7000 are _____. ROUND TO: 2 DECIMAL PLACES
Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $13.00 million fully installed and will be fully depreciated over a 16.00 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $3.04 million per year and increased operating costs of $697,823.00 per year. Caspian Sea Drinks' marginal tax rate is 31.00%. The incremental cash flows for produced by the RGM-7000 are _____. ROUND TO: 2 DECIMAL PLACES
Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $13.00 million fully installed and will be fully depreciated over a 15 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $3.20 million per year and increased operating costs of $693,330.00 per year. Caspian Sea Drinks' marginal tax rate is 29.00%. The internal rate of return for the RGM-7000 is _____. ROUND TO: 4 DECIMAL PLACES
Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $12.00 million fully installed and will be fully depreciated over a 20 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.83 million per year and increased operating costs of $651,480.00 per year. Caspian Sea Drinks' marginal tax rate is 35.00%. If Caspian Sea Drinks uses a 10.00% discount rate, then the net present value of the RGM-7000 is _____. ROUND TO 2: DECIMAL PLACES
Caspian Sea Drinks' is financed with 68.00% equity and the remainder in debt. They have 11.00-year, semi-annual pay, 5.57% coupon bonds which sell for 98.41% of par. Their stock currently has a market value of $25.41 and Mr. Bensen believes the market estimates that dividends will grow at 3.74% forever. Next year's dividend is projected to be $2.11. Assuming a marginal tax rate of 27.00%, what is their WACC (weighted average cost of capital)? ROUND TO: 2 DECIMAL PLACES