PLEASE ANSWER ALL QUESTIONS

eBook Commonwealth Construction (CC) needs $2 million of assets to get started, and it expects to have a basic earning power ratio of 25%. CC will own no securities, all of its income will be operating income. Hit so chooses, CC can finance up to 25% of its assets with debt, which will have a 7% Interest rate. If it chooses to use debt, the firm will finance using only debt and common equity, so no preferred stock will be used. Assuming a 25% tax rate on taxable income, what is the difference between cc's expected ROE if it finances these assets with 25% debt versus its expected ROE if it finances these assets entirely with common stock? Round your answer to two decimal places percentage points B eBook Your father is 50 years old and will retire in 10 years. He expects to live for 25 years after he retires, until he is 85. He wants a fixed retirement income that has the same purchasing power at the time he retires as $35,000 has today. (The real value of his retirement income will decline annually after he retires.) Mis retirement income will begin the day he retires, 10 years from today, at which time he will receive 24 additional annual payments. Annual inflation is expected to be 3%. He currently has $200,000 saved, and he expects to earn 9% annually on his savings. How much must he save during each of the next 10 years (end-of-year deposits) to meet his retirement goal? Do not round Intermediate calculations, Round your answer to the nearest dollar. E eBook A 5-year Treasury bond has a 4,0% yield. A 10-year Treasury bond yields 6.0%, and a 10-year corporate bond yields 8.7%. The market expects that inflation will average 2.5% over the next 10 years (IP10 - 2.5%). Assume that there is no maturity risk premium (MRP = 0) and that the annual real risk-free rate, r* will remain constant over the next 10 years. (Hint: Remember that the default risk premium and the liquidity premium are zero for Treasury securities: DRP - LP -0.) A 5-year corporate bond has the same default risk premium and liquidity premium as the 10-year corporate bond described. What is the yield on this 5-year corporate bond? Round your answer to one decimal place