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I have 1 hour to answer this (TCO D) A bond currently sells for $887 even though it has a par of $1,000. It was
I have 1 hour to answer this
(TCO D) A bond currently sells for $887 even though it has a par of $1,000. It was issued two years ago and had a maturity of 10 years. The coupon rate is 7% and the interest payments are made semiannually. What is its YTM? (TCO D) A stock has just paid a dividend has declared an annual dividend of $12.00 to be paid one year from today. The dividend is expected to grow at a 7% annual rate. The return on equity for similar stocks is 12%. What is P0? (TCO F) A company has the opportunity to do any of the projects for which the net cash flows per year are shown below. The company has a cost of capital of 12%. Which should the company do and why? You must use at least two capital budgeting methods. Show your work. Year A B C 0 350 250 250 1 100 50 100 2 100 100 100 3 100 100 100 4 100 100 100 5 100 100 100 6 50 100 100 7 200 200 0 (TCO D) What is and why is it important to investors and issuers of stock? Describe the behavior of stocks with s of greater than one, less than one, and less than zero. (Points : 30) (TCO E) A company has 100 million shares outstanding trading for $8 per share. It also has $900 million in outstanding debt. If its equity cost of capital is 15%, and its debt cost of capital is 12%, and its effective corporate tax rate is 40%, what is its weighted average cost of capital? (Points : 30) (TCO D) What is and why is it important to investors and issuers of stock? Describe the behavior of stocks with s of greater than one, less than one, and less than zero. (Points : 30) (TCO E) A company has 100 million shares outstanding trading for $8 per share. It also has $900 million in outstanding debt. If its equity cost of capital is 15%, and its debt cost of capital is 12%, and its effective corporate tax rate is 40%, what is its weighted average cost of capital? (Points : 30)Step by Step Solution
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