Please Answer All!

1. You have gathered the following information for a company:

WACC	4%
Cost of equity	10%
Expected market value of firm in two years	$261.7472

Year	1	2
Free cash flow	11.44	130.8736

Based on this information and the free cash flow model, what firm value would you expect this company to have today?

A. Less than 300

B. Between 300 and 350

C. Between 350 and 400

D. More than 400

2. You have gathered the following information for a company

Income Statement Year Ended June 30, 2022

Net Income = 12

Dividends = 9

Number of Shares Outstanding = 6

Balance Sheet As of June 30, 2021

Total Assets = 100

Total Shareholder's Equity = 50

You expect this company to maintain constant return on equity, payout ratio, and mixture of debt and equity in perpetuity. Based on this information, what dividend per share would you expect this company to pay during the fiscal year ending on June 30, 2023?

A. Between $0 and $1

B. Between $1 and $1.25

C. Between $1.25 and $1.50

D. More than $1.50

3. Based on question 2 information:

You expect this company to maintain constant return on equity, payout ratio, and mixture of debt and equity in perpetuity. Based on this information, what is this companys plowback ratio during the 2022 fiscal year?

A. Between 0% and 10%

B. Between 10% and 20%

C. Between 20% and 30%

D. More than 30%

4. Based on question 2 information

You expect this company to maintain constant return on equity, payout ratio, and mixture of debt and equity in perpetuity. Based on this information, what is this companys dividends per share paid during the fiscal year ended on June 30, 2022?

A. Between $0 and $1

B. Between $1 and $2

C. Between $2 and $3

D. More than $3

5. Based on question 2 information

You expect this company to maintain constant return on equity, payout ratio, and mixture of debt and equity in perpetuity. Based on this information, what book value of equity would you expect this company to report on June 30, 2023?

A. Between 50 and 55

B. Between 55 and 60

C. Between 65 and 70

D. Between 75 and 80

E. More than 80

6. You have gathered the following information:

Cost of equity	10%
Current book value of equity per share	10
Expected earnings per share in one year	1.14
Residual income growth rate after one year, continuing afterwards in perpetuity	8%

Using the information in the table, estimate this companys share price.

A. Between 0 and 9

B. Between 9 and 18

C. Between 18 and 27

D. Between 27 and 36

E. More than 36

7. You have collected the following information:

Current dividend per share	10
Cost of equity	9%
Dividend growth rate in perpetuity	5%

Calculate this companys expected share price using the information given in the table.

A. Between $50 and $100

B. Between $100 and $150

C. Between $150 and $200

D. Between $200 and $250

E. More than $250

8. You have gathered the following information for a company:

Market value of firm	500
Market value of debt	200
Number of shares outstanding	25

Based on this information, what is this companys share price?

A. Between $0 and $10

B. Between $10 and $20

C. Between $20 and $30

D. More than $30

9. You have gathered the following information:

Cost of equity	10%
Expected share price in two years	84.70

Year	1	2
Dividends per share	4.40	7.26

Using the dividend discount model, calculate this companys expected share price.

A. Less than $55

B. Between $55 and $65

C. Between $65 and $75

D. More than $75

10. You have gathered the following information for a company

Income Statement Year Ended June 30, 2022

Net Income = 12

Dividends = 9

Number of Shares Outstanding = 6

Balance Sheet As of June 30, 2021

Total Assets = 100

Total Shareholder's Equity = 50

You expect this company to maintain constant return on equity, payout ratio, and mixture of debt and equity in perpetuity. Based on this information, what net income would you expect this company to have during the 2023 fiscal year ending on June 30, 2023?

A. Between $0 and $2

B. Between $2 and $4

C. Between $4 and $8

D. Between $8 and $12

E. More than $12