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show the steps to the answer please because i have been struglling with this all day Caspian Sea Drinks is considering the purchase of a
show the steps to the answer please because i have been struglling with this all day
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 $13.00 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 $3.40 million per year and increased operating costs of $505,911.00 per year. Caspian Sea Drinks' marginal tax rate is 29.00%. If Caspian Sea Drinks uses a 11.00% discount rate, then the net present value of the RGM- 7000 is Submit Answer format: Currency: Round to: 2 decimal places. #4 Caspian Sea Drinks' is financed with 63.00% equity and the remainder in debt. They have 11.00-year, semi- annual pay, 5.69% coupon bonds which sell for 98.35% of par. Their stock currently has a market value of $25.84 and Mr. Bensen believes the market estimates that dividends will grow at 3.37% forever. Next year's dividend is projected to be $2.50. Assuming a marginal tax rate of 20.00%, what is their WACC (weighted average cost of capital)? 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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