Sloppy Limited is facing gloomy prospects. The earnings and dividends are expected to decline at the rate of $5$ percent. The previous dividend was Rs$\mathrm{.}2\mathrm{.}00.$ If the current market price is Rs$\mathrm{.}10\mathrm{.}00,$ what rate of return do investors expect from the stock of Sloppy Limited?

$2.$ A firm has invested Rs$\mathrm{.}10000$ in its assets, it has used debt to the extent of $40\%,$ the cost of debt is $10\%,$ the cost of equity is $15\%,$ the beta of equity is $1\mathrm{.}2,$ EBIT is $40\%$ of assets and tax rate is $30\%.$ Given this, what is the value equity in this firm?

$(3)$A firm is evaluating a project which requires Rs$\mathrm{.}10$ million in investments. The Firm's financial manager is proposing two options to finance the project. First, all equity financing; second, Rs$.5$ million through $15\%$ debentures are issued at par, and Rs$.5$ million of ordinary equity. The managers expect three possible EBITs for this project, i$.$e$.,1\mathrm{.}5,2,$ and $2\mathrm{.}8$ million. You have to determine when the manager would use the first and second financing options

$(4)$A firm has invested Rs$\mathrm{.}10000$ in its assets, it has used debt to the extent of $40\%,$ the cost of debt is $10\%,$ the cost of equity is $15\%,$ the beta of equity is $1\mathrm{.}2$ and tax rate is $30\%.$ Given this, what would be the cost of capital at $20\%$ debt?

$5)$Two firms have $0\mathrm{.}75$ difference in their beta and $5\%$ difference in their expected return, what is the implied price of beta, risk free rate and market return?

$6)$You are evaluating a project which requires Rs$\mathrm{.}100000$ investments and produce Rs$\mathrm{.}20000$ cash flow for $6$ years. The cost of equity for all equity firm is $15\%.$ Find the NPV of the project and if NPV is negative, then find at what rate of debt $($available at $10\%)$ does this project NPV turn positive? Also, find the cost of capital at that debt level. Assume tax rate to be $25\%.(5)$