You were hired as a consultant to ND Winter Skydiving Company, whose target capital structure is 40% debt, 15% preferred, and 45% common equity. The interest rate on new debt is 8.00%, the yield on the preferred is 5.25%, the cost of retained earnings is 11.50%, and the tax rate is 30%. The firm will not be issuing any new stock. What is the company’s WACC? Round final answer to two decimal places. Do not round your intermediate calculations.

Investors who purchase bonds having lower credit ratings should expect:

Ingram Electric Products is considering a project that has the following cash flow and WACC data. What is the project’s MIRR?   WACC: 9.75% Year 0   1   2   3   Cash flows -$800 $350 $350 $350

Francis Inc.’s stock has a required rate of return of 10.25%, and it sells for $80.00 per share. The dividend is expected to grow at a constant rate of 6.00% per year. What is the expected year-end dividend, D1?

A stock has a beta of 1.4 and an expected return of 13.53%. What is the risk-free rate if the market rate of return is 10.6%?

Suppose the U.S. Treasury offers to sell you a bond for $3,000. No payments will be made until the bond matures 10 years from now, at which time it will be redeemed for $5,600. What interest rate would you earn if you bought this bond at the offer price?

What is the ROE for a firm with a times interest earned ratio of 2, a tax liability of $1 million, and interest expense of $1.5 million if equity equals $1.5 million?

The slope of the line fitted to a plot of a stock’s returns versus the market’s returns measures the:

How much should you pay for a $1,000 bond with 10% coupon, annual payments, and 5 years to maturity if the interest rate is 12%?

The benefits of portfolio diversification are highest when the individual securities have returns that: