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Please Answer Both Questions #3 unanswered Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This
Please Answer Both Questions
#3 unanswered Caspian Sea Drinks is considering the purchase of a new water filtration system produced by Rube Goldberg Machines. This new equipment, the RGM-7000, will allow Caspian Sea Drinks to expand production. It will cost $12.00 million fully installed and will be fully depreciated over a 20 year life, then removed for no cost. The RGM-7000 will result in additional revenues of $2.90 million per year and increased operating costs of $504,257.00 per year. Caspian Sea Drinks' marginal tax rate is 35.00%. If Caspian Sea Drinks uses a 10.00% discount rate, then the net present value of the RGM-7000 is not submitted Attempts Remaining: Infinity Submit Answer format: Currency: Round to: 2 decimal places. #4 + unanswered Caspian Sea Drinks' is financed with 63.00% equity and the remainder in debt. They have 12.00-year, semi-annual pay, 5.56% coupon bonds which sell for 97.08% of par. Their stock currently has a market value of $25.61 and Mr. Bensen believes the market estimates that dividends will grow at 3.62% forever. Next year's dividend is projected to be $2.70. Assuming a marginal tax rate of 20.00%, what is their WACC (weighted average cost of capital)? not submitted Attempts Remaining: Infinity Submit Answer format: Percentage Round to: 2 decimal places (Example: 9.24%, % sign required. Will accept decimal format rounded to 4 decimal places (ex: 0.0924)Step by Step Solution
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