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please help me answer class financial management with solutions Word stephanie he Subtle Em... Emphasis Intense E... Strong Quote Intense Q... Subtle Ref.. Intense Re...
please help me answer class financial management with solutions
Word stephanie he Subtle Em... Emphasis Intense E... Strong Quote Intense Q... Subtle Ref.. Intense Re... Book Styles 16) A group of venture investors is considering putting money into Lemma Books, which wants to produce a new reader for electronic books. The variable cost per unit is estimated at $250, the sales price would be set at twice the VClunit, or $500, and fixed costs are estimated at $350,000. The investors will put up the funds if the project is likely to have an operating income of $500,000 or more. What sales volume would be required in order to meet the minimum profit goal? Hint: Use the break-even formula, but include the required profit in the numerator.) a 3,706 b.3,400 c. 2.958 d. 3,094 e. 4,216 17) Gator Fab ics Inc. currently has zero debt (ie, wd= 0). It is a zeregrowth company, and data are shown below. Now the company is considering using some debt, moving to the new capital structure indicated below. The money raised would be used to repurchase stock at the current price. It is estimated that the increase in risk resulting from the additional leverage would cause the required rate of return on equity to rise somewhat, as indicated below. If this plan were carried out, by how much would the WACC change, ie, what is WACCold WACCMe? Do not round your intermediate calculations 40% 60% 6.0% Orig cost ofequity-4 New-cost ofequity Tax rate 10.0% 11.0% 4089 Interest rate new sd a 2.29% b. 1.96% c. 2.04% d 1.65% e 2.16%
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