Q1:

A firm incurs $35,000 in interest expenses each year. If the tax rate of the firm is 35?%, what is the effective? after-tax interest rate expense for the? firm?

Q2:

Your estimate of the market risk premium is 5?%. The? risk-free rate of return is 3?%, and General Motors has a beta of 1.1. According to the Capital Asset Pricing Model? (CAPM), what is its expected? return?

Q3:

Preferred stock of Ford Motors pays a dividend of $2.00 each year and trades at a price of $40. What is the cost of preferred stock capital for? Ford?

A. $19,338 B. $18,200 C. $22,750 D. $17,063