In addition to common stock, Quarri has 500,000 preferred shares outstanding that pay an annual dividend of $2 per share and are currently trading for $20.00 a share. The company's outstanding bonds have a market value of $200,000,000. There are 2 million shares of common stock outstanding with a current market price of $98.00 per share. what is the firm's weighted average cost of capital? A) 0.0899 B)0.0599 C)0.0699 D) 0.0799
Answers
To calculate the weighted average cost of capital (WACC), we need to consider the proportion of each capital component (common stock, preferred stock, and bonds) in the company's capital structure and their respective costs.
Given:
- Number of preferred shares outstanding: 500,000
- Dividend per preferred share: $2
- Market price of preferred shares: $20.00
- Number of common shares outstanding: 2,000,000
- Market price of common shares: $98.00
- Market value of bonds: $200,000,000
First, let's calculate the cost of each component:
1. Cost of common stock:
The cost of common stock can be estimated using the dividend discount model or the capital asset pricing model (CAPM). Since the required inputs for these models are not provided, we'll assume a cost of common stock based on the current market price.
Cost of common stock = Market price of common shares
= $98.00
2. Cost of preferred stock:
The cost of preferred stock can be calculated by dividing the annual dividend per share by the market price per share.
Cost of preferred stock = Annual dividend per preferred share / Market price of preferred shares
= $2 / $20.00
= 0.10 or 10%
3. Cost of debt (bonds):
The cost of debt can be approximated using the current yield to maturity or the yield on comparable bonds. Since the required inputs for these calculations are not provided, we'll assume a cost of debt based on the market value of bonds.
Cost of debt = Market value of bonds
= $200,000,000
Next, let's determine the proportion of each component in the capital structure:
Total market value of equity = (Number of common shares * Market price of common shares) + (Number of preferred shares * Market price of preferred shares)
= (2,000,000 * $98.00) + (500,000 * $20.00)
= $196,000,000 + $10,000,000
= $206,000,000
Total market value of the firm = Total market value of equity + Market value of bonds
= $206,000,000 + $200,000,000
= $406,000,000
Proportion of common stock = (Market value of common stock) / (Total market value of the firm)
= ($196,000,000) / ($406,000,000)
Proportion of preferred stock = (Market value of preferred stock) / (Total market value of the firm)
= ($10,000,000) / ($406,000,000)
Proportion of debt = (Market value of debt) / (Total market value of the firm)
= ($200,000,000) / ($406,000,000)
Finally, we can calculate the weighted average cost of capital (WACC) using the proportions and costs of each component:
WACC = (Proportion of common stock * Cost of common stock) + (Proportion of preferred stock * Cost of preferred stock) + (Proportion of debt * Cost of debt)
Substitute the values and calculate the WACC:
WACC = [(Proportion of common stock * Cost of common stock) + (Proportion of preferred stock * Cost of preferred stock) + (Proportion of debt * Cost of debt)]
= [(($196,000,000) / ($406,000,000) * $98.00) + (($10,000,000) / ($406,000,000) * 0.10) + (($200,000,000) / ($406,
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Related Questions
For most people, almost two-thirds of each work day is taken up by work and sleep. Please select the best answer from the choices provided T F
Answers
Answer:
True
Explanation:
For most people, almost two-thirds of each workday is taken up by work, and sleep is a true statement.
What is the statement?Statements are sentences that express a fact, idea, or opinion. Statements do not ask questions, make requests or give commands. They are also not utterances. Statements are sentences that express a fact, idea, or opinion. Statements do not ask questions, make requests or give speech acts. They are also not exclamations.
The term working day refers to the days in the working week, the span of (often five) days that are not the weekend, and when many people work. The word workday means the same thing as a working day
Therefore, By the above statement, for the t two-thirds of each work day is taken up by work and sleep is correct.
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TRUE OR FALSE: when you have a credit card or loan, it is better to have higher interest rate
Answers
Answer: Lower interest rate are better. Higher interest rate is worse
Explanation:
A lower interest rate is better when borrowing money through credit cards or loans. You will be paying less. High interest rates are only good when you are the lender.
A manager who involves members of the team in decisions is using which management style?
A.
Authoritarian
B.
Hands-off
C.
Participative
D.
Autocratic
Answers
Answer:
c.
Explanation:
Answer:
i think its c) to
Explanation:
Which kind of business opportunity is like buying a business kit?
Pilihan jawaban
Starting a new business from scratch
Buying a franchise
Buying an existing business
Answers
The type of business opportunity is comparable to purchasing a business kit or a franchise. Hence the right option is (C).
The term "franchise" refers to a method of marketing products or services in which a franchisor develops the brand's trade name and business model and a franchisee pays a royalty and frequently an upfront fee to obtain the right to use the franchisor's name and system.
you've thought if you're a budding entrepreneur or an established businessperson looking to diversify your holdings. The short answer is yes, particularly if a fantastic opportunity arises. The appeal of launching a business by purchasing a franchise is clear.
Listed below are a handful of the most typical causes of franchise failure: The franchisor offers its products to franchisees who are unqualified, inexperienced, undercapitalized, or naive. Franchisees sometimes have false expectations of the amount of effort involved in running a business.
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With the emergence of smartphones, users no longer have to carry a separate music player, a video game, a laptop, or a magazine to keep themselves entertained when traveling. A smartphone is loaded with a variety of applications to satisfy all the customer needs that different industries or products individually satisfied earlier. As a result, the smartphone industry has been posing a threat to a lot of other unrelated industries. What is this phenomenon best known as
Answers
Answer: Industry Convergence
Explanation: Industry Convergence has been boosted by the increased leverage of science and technology to various industries which has seen many industries break from the traditional single market focus and transition in a more robust cross industry focus whereby industries can incorporate several individual product into its production plan thereby providing more value added product and services. Smartphone companies as described above have integrated several single market products such as radio, music player, gaming, internet connectivity, camera and video recording, flash light(torch) and so on. thereby creating a robust and cross-industry product which adds more value and products able to withstand competition.
2.which of the following statements best describes a keynesian approach to economics? a)aggregate demand is the most important driving force in the economy, but free-markets have no self-balancing mechanisms that lead to full-employment; therefore, government intervention is often necessary to stabilize an economy. b)politics determines economics, the nature of economics is conflictual, and the main actors are nation-states; therefore, the main goal of economic activity is the maximization of national interest. c)individual freedom to pursue interests/wealth in an open market free of government interference with the role of government to primarily protect property rights. d)resources flow from a periphery of poor and underdeveloped countries (global south) to a core of wealthy states (global north) enriching the latter at the expense of the former. poor countries are systemically locked into this unfavorable situation.
Answers
Option a is correct. The main economic driver is aggregate demand, but since free markets lack self-balancing mechanisms that lead to full employment, stabilising an economy frequently requires government intervention.
A macroeconomic theory known as Keynesian economics examines the total amount of spending in the economy and how it affects production, employment, and inflation. In an effort to comprehend the Great Depression, British economist John Maynard Keynes created it in the 1930s.
The fundamental tenet of Keynesian economics is that economic stabilisation may be achieved by government intervention. Keynes' theory was the first to clearly distinguish between the study of individual motivations and economic behaviour from those of broad aggregate variables and conceptions.
Keynes' theory led him to propose higher government spending and lower taxes as a way to boost demand and rescue the world economy from the Great Depression. Later, the term "Keynesian economics" was used to describe the idea that economic performance could be optimised and economic downturns might be avoided.
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According to the law of supply, the supply of a product will go up if:
со
A. the product's cost increases.
B. the product's price decreases.
C. the product's price increases.
D. the product's cost decreases.
Answers
\(\textsf{The supply of a product will go up (increase) } \)\( \textsf{if the cost of manufacturing it decreases.} \) \( \textsf{hence the correct choice will be : } \)
\({ \quad\dashrightarrow \texttt { D.) The product's cost decreases }} \)
the purpose of a budget is to track your income and your spending. truefalse
Answers
The statement "the purpose of a budget is to track your income and your spending" is true. A budget is a plan for your finances that summarizes your income and your spending and helps you track your spending in a given period.
The main answer to the question is true. Budgets can also assist you in accomplishing long-term financial objectives. It enables you to know where you stand with your money and take action to improve your financial situation. A budget is essential to track your income and expenses because it will help you identify areas where you may be wasting money and where you need to cut back.
It can also help you plan for upcoming expenses and save for future goals such as a vacation, a new car, or a down payment on a home.To summarize, the main purpose of a budget is to track your income and your spending. With a budget, you can plan and monitor your finances in order to achieve your goals and improve your overall financial well-being.
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An insured owns a home with a replacement cost of $300,000 and a market value of $250,000. What is the most a valued policy will pay in the event of a total loss without a deductible
Answers
The most a valued policy will pay in the event of a total loss without a deductible is the predetermined amount agreed upon between the insured and the insurer, which may be equal to the replacement cost of the home or a lower agreed-upon amount.
A valued policy is a type of insurance policy that pays a predetermined amount in the event of a total loss, regardless of the actual value of the property at the time of the loss. In this case, the insured owns a home with a replacement cost of $300,000 and a market value of $250,000. The most a valued policy will pay in the event of a total loss without a deductible is the predetermined amount agreed upon between the insured and the insurer.
This amount may be equal to the replacement cost of the home, or it may be a lower amount that is agreed upon by both parties. It is important to note that a valued policy is different from an actual cash value policy, which takes into account the depreciated value of the property at the time of the loss. With an actual cash value policy, the payout may be less than the replacement cost of the property. However, with a valued policy, the insured is guaranteed to receive the predetermined amount, regardless of the actual value of the property.
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what happens if my tax return is rejected after the deadline?
Answers
Can someone please help me with this!!!!
Answers
Answer:
Eh easy aall you have to do is pay 4,305 dolllars
Explanation:
Derek's team is struggling to come to a consensus because several people are unwilling to share their thoughts. What would be the BEST question for the group to ask themselves to avoid groupthink?
Question 3 options:
How is this situation similar to others we've encountered?
What about the group could be making people feel unsafe?
How would this situation look different if we had more money?
Can we get rid of the people who aren't willing to speak up?
Answers
If the team is struggling to come to a consensus because several people are unwilling to share their thoughts. The BEST question for the group to ask themselves to avoid groupthink is: B) What about the group could be making people feel unsafe?
What is groupthink?Groupthink refers to the way in which members of a group accepts
the decisions made in the group even if the decision they all accepted will have a negative effect on them as they do not consider the consequence that is attached to the conclusion they reach and they does this so as to be in one accord or for unity to reign among them.
Based on the given scenario it is advisable that the leader of the group to ask the members the reason why they feel unsafe to shares their thought or what they have on the mind as by doing this will help to give them insight about the reason why the members are unwilling to share their thought as well how to combat that feelings.
Therefore the correct option is B.
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Answer: What about the group could be making people feel unsafe?
Explanation: I took the quiz
Snoopycatlover
(this is for art)
Answers
Answer:
ty
Explanation:
Answer:
what's the question?
Explanation:
I need a question to answer
he preemptive right is the right of current stockholders to buy new shares in an amount that will maintain their proportionate ownership in the firm. true or false
Answers
The statement 'The preemptive right is the right of current stockholders to buy new shares in an amount that will maintain their proportionate ownership in the firm' is true.
In the field of business, preemptive rights can be described as the rights of the stockholders of a business to buy more shares in a business before those shares are offered to anybody else.
Through the preemptive rights, new shares are brought that will allow the stockholder to maintain proportionate ownership in the business.
A preemptive right allows the correct stockholders to invest more in the same business.
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which ratio change provides good news about a company? multiple choice question. a decrease in assets-to-equity ratio a decrease in the net profit margin ratio an increase in debt-to-equity ratio an increase in the net profit margin ratio
Answers
Option 3rd is correct. An increase in an increase in debt-to-equity ratio (leverage ratio) change is good news for the company.
The Debt to Equity (D/E) ratio is used to assess a company's financial leverage and is calculated by dividing the company's total debt by its equity. The D/E ratio is an important key figure in corporate finance. This is a measure of the extent to which a company finances its operations with debt rather than with its own funds.
Leverage is a special kind of leverage. The Debt to Equity (D/E) ratio compares a company's total debt to equity and can be used to assess a company's dependence on debt.
Debt-to-equity ratios vary by industry and are best used to compare direct competitors or measure a company's dependence on debt equity over time.
For similar companies, higher D/E ratios indicate higher risk, but especially low ones may indicate that the company is not using leverage to expand. Investors often change the D/E ratio to include only long-term debt, as it is riskier than short-term debt.
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An environmental lawyer is not part of the Energy cluster.
True or False for K12
Answers
Answer:
True
Explanation:
Lawyers belong to the Law, Public Safety, Corrections, and Security cluster. Work under this career cluster revolves around protecting citizens and their rights. Lawyers train and acquire university degree before training at the law school.
Lawyers may specialize in a specific area such as crime, tax, environment, and so many others. Other prominent job titles for lawyers include Attorney General, Associate Attorney, Attorney, Attorney at Law, General Counsel, and Partner.
1.What is a business transaction?
Answers
Answer:
A business transaction is an event involving an interchange of goods, money or services between two or more parties.
Explanation:
A business transaction is an event involving an interchange of goods, money or services between two or more parties. The business transacted can be between two parties engaged in business and conducting the transaction for their mutual benefits, or between a business entity, like a retail shop, and a customer.
Help please! Will mark brainliest!
Which of these job descriptions is least likely to fall under an events' manager?
Answers
Answer:B or D!
Explanation:
I say this because of the descriptions but its your choice.
A new school building was recently built in the area. The entire cost of the project was $20,000,000. The city has put the project on a 20-year loan with an APR of 2.7%. There are 21,000 families that will be responsible for making monthly payments towards the loan. Determine the total amount that each family should be required to pay each year to cover the cost of the new school building. Round your answer to the nearest cent, if necessary.
Answers
Each family should be required to pay approximately $25.71 per year to cover the cost of the new school building.
To determine the total amount that each family should be required to pay each year to cover the cost of the new school building, we can follow these steps:
Calculate the total loan amount.
The loan amount is the cost of the project, which is $20,000,000.
Calculate the annual interest payment.
The annual interest payment can be calculated using the formula:
Annual Interest Payment = Loan Amount * Annual Interest Rate
Annual Interest Rate = APR / 100
In this case, the annual interest rate is 2.7% or 0.027.
Annual Interest Payment = $20,000,000 * 0.027 = $540,000
Determine the number of families responsible for payments.
There are 21,000 families responsible for making monthly payments.
Calculate the total amount each family should pay each year.
Total Amount per Family = Annual Interest Payment / Number of Families
Total Amount per Family = $540,000 / 21,000
Rounding the result to the nearest cent, each family should be required to pay approximately $25.71 per year to cover the cost of the new school building.
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Jannah is reviewing a report that a new marketing manager put together after assessing her small business. If Jannah wants to learn how familiar a customer market is with her company’s products or services, what section of the marketing report should she review?
A.
Financial
B.
Quality control
C.
Brand recognition
D.
Profit margins
Answers
the approach of using a combination of memeory types to proviede the best performance at the best cost is called
Answers
The approach of using a combination of memory types to provide the best performance at the best cost is called a Memory Hierarchy.
In a memory hierarchy, the top layer consists of the fastest and most expensive memory, such as cache memory or registers. This layer is limited in capacity but offers quick access times for frequently used data. The next layer typically includes the main memory, also known as Random Access Memory (RAM), which has a larger capacity and lower cost per byte but slower access times compared to cache memory.
Further down the hierarchy, you find secondary storage devices, like Solid State Drives (SSDs) or Hard Disk Drives (HDDs). These storage options have a much larger capacity and lower cost per byte compared to RAM, but their access times are slower. Finally, at the bottom of the hierarchy, there are tertiary storage options such as optical disks and tape drives, which provide even larger capacity and lower cost per byte but have much slower access times.
In summary, a memory hierarchy combines different types of memory to offer the best performance at the best cost. By utilizing a mix of fast, expensive memory for frequently accessed data and slower, less expensive memory for less frequently accessed data, a system can achieve optimal performance while keeping costs manageable.
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What is significance of evaluating PeCS of a successfull entrepreneur? What insights can you draw from this activity?
Answers
Answer:
It is very important to assess one's personal entrepreneurial competencies (PECs) in order to know the strengths and weaknesses of the entrepreneur. In that manner, the entrepreneur can design a plan to compensate for his weaknesses and develop his strength in order to deliver the excellency that was expected of him.
The full cost of attendance to an institute of higher education, including tuition, room and board, books and other costs is known as _____.
A. Sticker price
B. A full ride
C. The reduced price
D: The net cost
Answers
Answer:
A. Sticker Price
Explanation:
The full cost of attendance to an institute of higher education, including tuition, room and board, books and other costs is known as Sticker Price.
To address a rise in the unemployment rate a government may:
A. Lower interest rate to allow businesses to borrow last money
B. Raise interest rates to allow businesses to borrow less money
C. Reduce the amount of money in circulation
D. Invest in programs that help people in need
Answers
Answer:
D
Explanation:
Invest in programs that will help people in need. By investing in these programs workers will need to be employed and trained to be able to help the people in need which will therefore create employment and address the rise in the unemployment rate.
The government may invest in programs that help for addressing a rise in the unemployment rate. Hence, Option D is correct.
What do you mean by unemployment rate?The unemployment rate can be referred to as the proportion of unemployed people in an economic system amongst people presently withinside the labor force.
The unemployment price can b calculated by expressing the number of unemployed people as a percentage of the entire amount of people withinside the labor force.
Hence, The government may invest in programs that help for addressing a rise in the unemployment rate. Option D is correct.
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if the sec does not agree with a standard issued by the private sector, it can
Answers
The Securities and Exchange Commission (SEC) is the agency charged with regulating securities transactions in the United States. While the SEC must comply with all laws and regulations that exist, it also has the authority to create its own regulations and standards.
This means that the SEC can choose to disapprove of a private sector standard if it believes that the standard does not meet the SEC's regulatory requirements. In such cases, the SEC may issue its own standard or regulation or require that the private sector standard be amended to meet the SEC's requirements. This allows the SEC to ensure that all securities transactions are conducted in an ethical and responsible manner while protecting investors from fraud and other financial risks.
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Carolyn bates is a junior in college studying economics. She has created a new software application that applies the four principles of economic decision making to any potential decision that a user faces. She is considering leaving school after this academic year to pursue further development of her app. Carolyn should consider all of the following costs when calculating the opportunity costs of leaving college except the.
Answers
Carolyn should consider all of the following costs when calculating the opportunity costs of leaving college except the skills she may gain from her final year of economics courses.
The next best option you have to forgo in order to obtain something is its true cost. Instead of only considering the direct costs, your choices should take this opportunity cost into account.
Opportunity cost is the advantage that was lost because a particular option was not selected.
It is necessary to weigh the advantages and disadvantages of each choice offered in order to correctly assess opportunity costs.
Opportunity costs have a value that can help people and businesses make more lucrative decisions.
Opportunity cost is a wholly internal expense that is only utilised for strategic consideration; it is not included in accounting profit and is not reported externally.
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The following money market account rates were available from a particular bank. Find the compound amount and the interest earned. $7000 at 1.06% compounded daily for one year
Answers
The compound amount and interest earned, we can use the formula for compound interest: Compound Amount = Principal × (1 + Interest Rate/Number of Compounding Periods)^(Number o Compounding Periods × Time)
Given: Principal (P) = $7000Interest Rate (R) = 1.06% = 0.0106 (expressed as a decimal)Number of Compounding Periods (n) = 365 (compounded daily)Time (t) = 1 year Using the formula, the compound amount is calculated as follows: Compound Amount = $7000 × (1 + 0.0106/365)^(365 × 1) = $7000 × (1.000029041)^365 ≈ $7000 × 1.010 ≈ $7070.32To find the interest earned, we subtract the principal from the compound amount: Interest Earned = Compound Amount - Princi = $7070.32 ≈ $70.32Therefore, the compound amount after one year is approximately $7070.32, and the interest earned is approximately $70.32.
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Which one of the following is a principle of internal control that requires that different individuals should be responsible for related activities?
Choose matching definition
segregation of duties
establishment of responsibility
independent internal verification
documentation procedures
Answers
The principle of internal control that requires that different individuals should be responsible for related activities is "segregation of duties". This means that different employees should have different responsibilities within a company to reduce the risk of fraud or errors. For example, the employee who handles cash should not also be responsible for recording cash transactions in the company's books.
By separating these tasks, the risk of errors or fraud is reduced because there are checks and balances in place. This principle is an important aspect of internal control and helps to ensure that a company's financial statements are accurate and reliable.
The principle of internal control that requires different individuals to be responsible for related activities is called "segregation of duties." This principle ensures that tasks are divided among various employees to minimize the risk of errors and fraud. By separating duties, no single individual has control over all aspects of a transaction, which promotes a system of checks and balances and enhances the overall effectiveness of internal controls.
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abigail bought 28 shares of stock at $30.00 per share. she received dividend of $49.50 during the year. at the end of the year, her stock was valued at $43.50 per share. what was her ROI?
Answers
If her stock was valued at $43.50 per share. Her ROI is:50.89%
Return on investmentFirst step
Purchase price=(28×$30)-(28×$43.50)
Purchase price= $840-$1218
Purchase price=$378
Gain in value=$378+ $49.50
Gain in value=$427.5
Second step
ROI=$427.5/$840×100
ROI=50.89%
Therefore the ROI is $15.89%.
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Describe the characteristics of three technology-based business models.
Answers
Answer:1. The value is created using digital technologies
2. Digital business models are new to the market
3. Digital customer acquisition and distribution
4. USP is created digitally
Explanation: