This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Initech has 7 million shares of common stock outstanding and 50,000 bonds outstanding. The bonds pay ... (Read 110 times)

jilianpiloj

  • Hero Member
  • *****
  • Posts: 521
on: Apr 25, 2021
Initech has 7 million shares of common stock outstanding and 50,000 bonds outstanding. The bonds pay semi-annual coupons at an annual rate of 9.05%, have 6 years to maturity and a face value of $1,000 each. The common stock currently sells for $30 a share and has a beta of 1. The bonds sell for 94% of face value and have a 10.42% yield to maturity. The market risk premium is 5.5%, T-bills are yielding 5% and the tax rate is 30%. What is the firm's capital structure weight for debt?
◦ 18.3%
◦ 19.3%
◦ 20.3%
◦ 21.3%
◦ 22.3%
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
Buy Test-Bank


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by jilianpiloj on Apr 25, 2021

chevyboi1976

  • Sr. Member
  • ****
  • Posts: 344
Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
Answer Preview
Only 56% of students answer this correctly


jilianpiloj

  • Member
  • Posts: 521
Reply 2 on: Apr 25, 2021
YES! Correct, THANKS for helping me on my review

Joy Chen

  • Member
  • Posts: 354
Reply 3 on: Yesterday
Wow, this really help

« previous next »
 

Did you know?

For high blood pressure (hypertension), a new class of drug, called a vasopeptidase blocker (inhibitor), has been developed. It decreases blood pressure by simultaneously dilating the peripheral arteries and increasing the body's loss of salt.

Did you know?

Pregnant women usually experience a heightened sense of smell beginning late in the first trimester. Some experts call this the body's way of protecting a pregnant woman from foods that are unsafe for the fetus.

Did you know?

The use of salicylates dates back 2,500 years to Hippocrates’s recommendation of willow bark (from which a salicylate is derived) as an aid to the pains of childbirth. However, overdosage of salicylates can harm body fluids, electrolytes, the CNS, the GI tract, the ears, the lungs, the blood, the liver, and the kidneys and cause coma or death.

Did you know?

About 3% of all pregnant women will give birth to twins, which is an increase in rate of nearly 60% since the early 1980s.

Did you know?

Nearly 31 million adults in America have a total cholesterol level that is more than 240 mg per dL.

Pollen from a variety of common plants Pollen from a variety of common plants
The family of a soldier in the 31st Philadelphia Infantry camps near Washington, DC. Although both a The family of a soldier in the 31st Philadelphia Infantry camps near Washington, DC. Although both a
Common Types of Neuropathic Pain Common Types of Neuropathic Pain
Common Prefixes Common Prefixes
Common Prefixes Cont. Common Prefixes Cont.
Common Abbreviations and Symbols Used by Massage Therapists Cont Common Abbreviations and Symbols Used by Massage Therapists Cont
Video: Peptide Bond Formation Animation

For a complete list of videos, visit our video library