A firm with a 10.5 percent cost of capital is considering a project for this year’s capital budget.  The project’s expected after-tax cash flows are as follows: Year: 0 1 2 3 4 Cash flow: -$13,000 $4,700 $4,400 $4,600 $6,400 Calculate the project’s payback period.

Spelling, punctuation, and accent mark count toward grading.  Misspelled, wrong tense, or wrong form of verbal conjugation (- full points worth).  Missing article or preposition (-1/2 point). Missing accents from the words you have been exposed to during the chapter, and punctuation–periods, capital letters, upside-down exclamation or question marks–If needed (-1/4 points).   Accent Marks Please write me a short message, in parenthesis, next to the word that needs it, for instance: You need to write  ¡Mi mamá comprará el juguete mañana para Iván! You will write it like (upside-down exclamation mark) Mi mama (accent on the 2nd a) comprara (accent on the second a) el juguete manana (tilde over the 1st n) para Ivan (accent on a)! Notice that when there is more than one repeated vowel/consonant, I used more details on which vowel/consonant the accent mark was placed–mamá, mañana, etc. Unlike the name “Ivan” which has one accentuated vowel.   Directions Singular or plural? Write the singular or the plural form of the nouns. Follow the model.  Model: –Hay una maleta.    No. Hay cuatro _________ . The answer is maletas.     Hay un diccionario.   No. Hay cuatro .

A firm with a 10 percent cost of capital is evaluating two projects for this year’s capital budget.  The projects’ expected after-tax cash flows are as follows: Year: 0 1 2 3 Project X: -$15,000 $6,200 $8,300 $5,700 Project Y: -$9,000 $3,700 $3,200 $3,300 If Projects X and Y are mutually exclusive, which one(s) should the firm adopt?

Spelling, punctuation, and accent mark count toward grading.  Misspelled, wrong tense, or wrong form of verbal conjugation (- full points worth). Missing article or preposition (-1/2 point). Missing accents from the words you have been exposed to during the chapter, and punctuation–periods, capital letters, upside-down exclamation or question marks–If needed (-1/4 points).   Accent Marks Please write me a short message, in parenthesis, next to the word that needs it, for instance: You need to write  ¡Mi mamá comprará el juguete mañana para Iván! You will write it like (upside-down exclamation mark) Mi mama (accent on the 2nd a) comprara (accent on the second a) el juguete manana (tilde over the 1st n) para Ivan (accent on a)! Notice that when there is more than one repeated vowel/consonant, I used more details on which vowel/consonant the accent mark was placed–mamá, mañana, etc. Unlike the name “Ivan” which has one accentuated vowel.   Directions: La hora Josefa y Jorge meet on campus. Answer the question in Spanish in a complete sentence. Please write the time as words, for example, 3:45 pm is three forty-five pm.   ¿Y la clase de geografía? La clase (is at 4:30 p.m.) Please use a complete Spanish sentence to answer the question.

The Bettencourt Company’s currently outstanding bonds have a 12.8 percent coupon and a 13.5 percent yield to maturity.  Bettencourt believes it could issue new bonds that would provide a similar yield to maturity.  If its marginal tax rate is 25 percent, what is Bettencourt’s after-tax cost of debt?

Loyd & Sons’ common stock currently trades at $50 a share.  It is expected to pay an annual dividend of $1.50 a share at the end of the year (D1 = $1.50), and the constant growth rate is 10.1 percent a year.  What is the company’s cost of common equity if all of its equity comes from retained earnings?

Accent Marks Please write me a short message, in parenthesis, next to the word that needs it, for instance: You need to write  ¡Mi mamá comprará el juguete mañana para Iván! You will write it like (upside-down exclamation mark) Mi mama (accent on the 2nd a) comprara (accent on the second a) el juguete manana (tilde over the 1st n) para Ivan (accent on a)! Notice that when there is more than one repeated vowel/consonant, I used more details on which vowel/consonant the accent mark was placed–mamá, mañana, etc. Unlike the name “Ivan” which has one accentuated vowel.   Directions In a small English paragraph, please explain how to change a singular Spanish noun ending in the letter “z” into a plural form and provide a Spanish example with the English noun “pencil.” Please translate “pencil” into Spanish to create your Spanish example.

The Herron Company’s cost of common equity is 16 percent, its before-tax cost of debt is 11 percent, and its marginal tax rate is 35 percent.  Given Herron’s market value capital structure below, calculate its WACC. Long-term debt $40,000,000 Common equity   50,000,000 Total capital $90,000,000

Ivey Industries plans to issue a $100 par perpetual preferred stock with a fixed annual dividend of 12 percent of par.  It would sell for $99.80, but flotation costs would be 5 percent of the market price.  What is the percentage cost of preferred stock after taking flotation costs into account?

Ritter Manufacturing can invest in one of two mutually exclusive machines that will make a product it needs for the next 4 years.  Machine C costs $9 million but realizes after-tax inflows of $6.1 million per year for 2 years, after which it must be replaced.  Machine D costs $16 million and realizes after-tax inflows of $6.9 million per year for 4 years.  Based on the firm’s cost of capital of 9 percent, the NPV of Machine D is $6,354,067, with an equivalent annual annuity (EAA) of $1,961,301 per year.  Calculate the EAA of Machine C. Compare your result to that of Machine D and decide which to recommend.