Friday, February 28, 2020

Math Problems Speech or Presentation Example | Topics and Well Written Essays - 500 words

Math Problems - Speech or Presentation Example Dividends have grown at the rate of 4.8% per year and are expected to continue to do so for the foreseeable future. What is Crypton’s cost of capital where the firm’s tax rate is 30%. Q. 3: as a member of Financial Department Ranch Manufacturing, your supervisor has asked you to compute the appropriate discount rate to use when evaluating the purchase of new packing equipment for the plant. Under the assumption that the firm’s present capital structure reflects the appropriate mix of capital sources for the firm, you have determined the market value of the firm’s capital structure as follows. To finance the purchase, Ranch manufacturing will sell 10-year bonds paying 6.6% per year at the market price of $1,028. Preferred stock paying a $2.05 dividend can be sold for $25.01. Common stock for Ranch Manufacturing is currently selling for $54.41 per share and the firm paid a 3.08 dividend last year. Dividends are expected to continue growing at a rate of 3.5% per year into the indefinite future. If the firm’s tax rate is 30%, what discount should you use to evaluate the equipment

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