Question 1.1.A firm is considering a $300,000 debt issue. Their corporate tax rate is 34%. This long-term issue will pay a coupon rate of 5.6%. What is the after-tax cost of this debt? (Points : 1)

37% 3.67% 32% 1.56

Question 2.2.If a firm pays a constant dividend of $3.45 a share and investors require a 12% return, what is the value of that firm's stock? (Points : 1)

$12.45 $345.00 $28.75 $34.50

Question 3.3.Next year, stockholders will benefit from a 7% increase over the current dividend of $4.86, and every indication points to continued growth at this same pace. This stock is currently trading at $42 per share. Given that it costs $2.88 per share to issue new common stock, what is the cost of new common equity capital? (Points : 1)

19.42% 20.29% 12.38% 12.42%

Question 4.4.A firm offers a 15-year maturity bond with $1,000 face value and 6% coupon rate. The current market price for the bond is $998. Selling the bonds costs the firm $60 per share. What is the after-tax cost of this debt, assuming a 34% corporate tax? (Points : 1)

6.60% 8.12% 4.40% 31.73%

Question 5.5.On the secondary market, bonds are trading at $1105. The bonds have a 3.75% coupon rate paid annually and mature in five years. What is the yield to maturity (expressed at an annual rate) for the bonds if an investor buys them at the $1105 market price, and what is the current yield? (Points : 1)

This bond has a yield-to-maturity rate of 1.55% and a current yield of 3.39%. This bond has a yield-to-maturity rate of 1.38% and a current yield of 3.75%. This bond has a yield-to-maturity rate of 1.55% and a current yield of 3.75%. This bond has a yield-to-maturity rate of 5.63% and a current yield of 3.39%.

Question 6.6.The current dividend for a corporation is $3.73. The dividend is expected to increase by 12%, and it is expected to continue that rate of growth for the foreseeable future. Given that their stock is trading at $38 per share and that it costs $3.37 per share to issue new common stock, what is the cost of new common equity capital? (Points : 1)

10.99% 22.77% 24.06% 10.77%

Question 7.7.A firm offers a 10-year maturity bond with $1,000 face value and 5.25% coupon rate. The current market price for the bond is $1025. Selling the bonds costs the firm $48 per share. What is the after-tax cost of this debt, assuming a 34% corporate tax? (Points : 1)

5.56% 3.66% 6.07% 32.11%

Question 8.8.On the secondary market, bonds are trading at $925. The bonds have a 2.83% coupon rate paid semiannually and mature in three years. What is the yield to maturity (expressed at an annual rate) for the bonds if an investor buys them at the $925 market price? (Points : 1)

This bond has a yield-to-maturity rate of 8.55% and a current yield of 2.83%. This bond has a yield-to-maturity rate of 3.21% and a current yield of 2.83%. This bond has a yield-to-maturity rate of 5.58% and a current yield of 3.06%. This bond has a yield-to-maturity rate of 2.79% and a current yield of 3.06%.

Question 9.9.A common stock paid a dividend of $3.75 this year. It is expected to grow at 8% each year for the foreseeable future. Investors require an 11% return rate. What is the value of a share of this stock? (Points : 1)

$135.00 $125.00 $22.50 $3.97

Question 10.10.A firm has $76,000,000 in debt, which accounts for 43% of their total funds raised; the after-tax cost of these funds is 6.10%. The same firm has $100 million in common stock, which accounts for 57% of their total funds raised; their after-tax costs (including transaction costs) are 15.7%. What is the weighted average cost of capital for these funds? (Points : 1)

2.63% 11.55% 10.21% 8.92%

Question 11.11.A firm issued $10 million in preferred stock at a price of $60.35 per share. The preferred shares carry an 11% dividend. The firm pays $2.87 per share in flotation costs per share. What is the cost of capital for this issuance of preferred stock? (Points : 1)

11.54% 2.31% 43.23% 16.01%

Question 12.12.A preferred stock pays 3% on its par value of $200, and the required rate of return is 9%. What is the dividend? (Points : 1)

$6 $60 $18 $1.80

Question 13.13.A stock paid $3.17 in dividends at the end of last year and is expected to pay a cash dividend until infinity. No growth is expected. Investors require a 6% rate of return. What is the value of the common stock? (Points : 1)

3.17 56 52.83 5.28

Question 14.14.A preferred stock pays 3% on its par value of $200, and the required rate of return is 9%. What is the value of the preferred stock? (Points : 1)

$60 $67 $200 $267

Question 15.15.The table below shows a firm's capital structure and estimated capital costs. Calculate this firm's weighted average cost of capital.

&#-96;(Points : 1)

9.00% 10.51% 12.85% 15.35%