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 183 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
Excellent

T4T

  • Member
  • Posts: 348
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

More than 150,000 Americans killed by cardiovascular disease are younger than the age of 65 years.

Did you know?

Green tea is able to stop the scent of garlic or onion from causing bad breath.

Did you know?

Excessive alcohol use costs the country approximately $235 billion every year.

Did you know?

Recent studies have shown that the number of medication errors increases in relation to the number of orders that are verified per pharmacist, per work shift.

Did you know?

Stevens-Johnson syndrome and Toxic Epidermal Necrolysis syndrome are life-threatening reactions that can result in death. Complications include permanent blindness, dry-eye syndrome, lung damage, photophobia, asthma, chronic obstructive pulmonary disease, permanent loss of nail beds, scarring of mucous membranes, arthritis, and chronic fatigue syndrome. Many patients' pores scar shut, causing them to retain heat.

Common drainage devices; C. Jackson-Pratt. Common drainage devices; C. Jackson-Pratt.
Normal Faults Common at divergent plate boundaries Normal Faults Common at divergent plate boundaries
Common Blood Test Groups Common Blood Test Groups
Common Abbreviations and Symbols Used by Massage Therapists Cont Common Abbreviations and Symbols Used by Massage Therapists Cont
The four most common hexoses The four most common hexoses
Common restriction enzymes, with their recognition sequence, DNA cutting patterns, and sources Common restriction enzymes, with their recognition sequence, DNA cutting patterns, and sources
Video: Renal Failure

For a complete list of videos, visit our video library