FINANCIAL LEVERAGE EFFECTS The Neal Company wants to estimate next year's return on equity (ROE) under different financial leverage ratios. Neal's total capital is $18 milion, it currently uses only common equity, it has no future plans to use preferred stock in its capital structure, and its federal-plus-state tax rate is 40%. The CFO has estimated next year's EBIT for thren possible states of the world: $5.1 million with a 0.2 probability, 13.2 million with a 0.5 probability, and $0.7 million with a 0.1 probability Calculate Neal's expected ROE, standard deviation, and coefficient or variation for each of the following debt-to-capital ratlos. Do not round intermediate calculations. Round your answers to two decimal places at the end of the calculations Debt/Capital ratio is 0 ROE O- CV - Debt Capital rate is 10%, interest rate is 9% HOE- O- CV Debit/Capital ratio is so interest rate is 11 ROE % Debt/Capital ratio is 60Interest rate is 14% Roca CV- Click here to read the eBook: Business and Finandal Risk FINANCIAL LEVERAGE EFFECTS The Neal Company wants to estimate next year's return on equity (ROE) under different financial leverage ratios. Neal's total capital is $18 milion, it currently uses only common equity, it has no future plans to use preferred stock in its capital structure, and its federal-plus-state tax rate is 40%. The CFO has estimated next year's EBIT for three possible states of the world: $5.1 milion with a 0.2 probability, $3.2 million with * 0.5 probability, and $0.7 million with a 0,3 probability Calculate Neal's expected ROE, standard deviation, and coefficient of variation for each of the following debt-to-capital ratios. Do not round intermediate calculations. Round your answers to two decimal places at the end of the calculations Debt/Capitol ratio is 0. ROE O- CV Debt/Capital ratio is 10%, Interest rate is ROE- O- CV- Debt/Capital ratio is 50% Interest rate is 11% ROE- D- CV- Debit/Capital ratio is 50% interest rate is 14% ROE CV FINANCIAL LEVERAGE EFFECTS The Neal Company wants to estimate next year's return on equity (ROE) under different financial leverage ratios. Neal's total capital is $18 milion, it currently uses only common equity, it has no future plans to use preferred stock in its capital structure, and its federal-plus-state tax rate is 40%. The CFO has estimated next year's EBIT for thren possible states of the world: $5.1 million with a 0.2 probability, 13.2 million with a 0.5 probability, and $0.7 million with a 0.1 probability Calculate Neal's expected ROE, standard deviation, and coefficient or variation for each of the following debt-to-capital ratlos. Do not round intermediate calculations. Round your answers to two decimal places at the end of the calculations Debt/Capital ratio is 0 ROE O- CV - Debt Capital rate is 10%, interest rate is 9% HOE- O- CV Debit/Capital ratio is so interest rate is 11 ROE % Debt/Capital ratio is 60Interest rate is 14% Roca CV- Click here to read the eBook: Business and Finandal Risk FINANCIAL LEVERAGE EFFECTS The Neal Company wants to estimate next year's return on equity (ROE) under different financial leverage ratios. Neal's total capital is $18 milion, it currently uses only common equity, it has no future plans to use preferred stock in its capital structure, and its federal-plus-state tax rate is 40%. The CFO has estimated next year's EBIT for three possible states of the world: $5.1 milion with a 0.2 probability, $3.2 million with * 0.5 probability, and $0.7 million with a 0,3 probability Calculate Neal's expected ROE, standard deviation, and coefficient of variation for each of the following debt-to-capital ratios. Do not round intermediate calculations. Round your answers to two decimal places at the end of the calculations Debt/Capitol ratio is 0. ROE O- CV Debt/Capital ratio is 10%, Interest rate is ROE- O- CV- Debt/Capital ratio is 50% Interest rate is 11% ROE- D- CV- Debit/Capital ratio is 50% interest rate is 14% ROE CV
