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please answer all questions in 10 min thanks Weaver Chocolate Inc. has outstanding $1000 par value bonds with 14 years to maturity and a 7.1
please answer all questions in 10 min thanks
Weaver Chocolate Inc. has outstanding $1000 par value bonds with 14 years to maturity and a 7.1 percent semiannual coupon rate. The bonds are selling for $1026. What is the company's pre-tax cost of debt? Select one: a. 7.76 percent b. 6.81 percent O c. 6.50 percent d. 3.40 percent O e. 6.95 percent When computing the weighted average cost of capital (WACC), it is generally better to base the capital structure weights on book values rather than market values because the market values tend to fluctuate widely. Select one: a. True O b. False The market risk premium is 9 percent and the risk-free rate is 3 percent. According to CAPM, what is the expected return on a stock with a beta of .7? Select one: O a. 8.3 percent O b. 6.3 percent O c. 7.7 percent O d. 9.3 percent e. 7.2 percent LookGood, Inc. has just announced that its earnings have dropped by 30 percent. In fact, its investors had anticipated even worse results (a decrease of 40 percent). As a result, LookGood's stock price will: Select one: a. increase. O b. decrease. O c. follow a random walk as usual. O d. remain the same. e. cannot be determined. Clear my choice Step by Step Solution
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