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Author Question: Brick Aviation Inc. has no debt but can borrow at 8% if it needs to. The shareholders require a ... (Read 44 times)

burton19126

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on: Apr 25, 2021

Question 1

Brick Aviation Inc. has no debt but can borrow at 6% if it needs to. The company's WACC is 12%. The tax rate is 35%. What is the required return of the company's shareholders?
◦ 7.8%
◦ 9.0%
◦ 12.0%
◦ Not enough information

Question 2

Brick Aviation Inc. has no debt but can borrow at 8% if it needs to. The shareholders require a return of 15%. The tax rate is 35%. If the company borrows such that its debt-to-value (D/V) ratio is 25%, then what will its cost of equity be? (Assume that Brick maintains the dollar amount of its debt at that level forever.)
◦ 15.9%
◦ 16.1%
◦ 16.3%
◦ 16.5%
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
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Marked as best answer by burton19126 on Apr 25, 2021

jamesnevil303

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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.
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burton19126

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Reply 2 on: Apr 25, 2021
Great answer, keep it coming :)

jordangronback

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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