8. Using the constant growth model, a firm's expected (D1) dividend yield is 3% of the stock price, and it's growth rate is 7%. If the tax rate is .35%, what is the firm's cost of equity?

a) 10%
b) 6.65%
c) 8.95 %
d) More information is required.

13. Assume a corporation has earnings before depreciation and taxes of $100,000, depreciation of $40,000, and that it has a 30 percent tax bracket. What are the after-tax cash flows for the company?

a) $82,000
b) $110,000
c) $42,000
d) None of the above

15. You buy a new piece of equipment for $5,535, and you receive a cash inflow of $1,000 per year for 8 years. What is the internal rate of return?

a) less than 10%
b) between 10% and 11%
c) between 11% and 12%
d) more than 12%

16. Stone Inc. is evaluating a project with an initial cost of $8,450. Cash inflows are expected to be $1,000, $1,000 and $10,000 in the three years over which the project will produce cash flows. If the discount rate is 13%, what is the net present value of the project?

a) less than $0
b) between $0 and $400
c) between $400 and $800
d) more than $800

Solution Preview

8. Using the constant growth model, a firm's expected (D1) dividend yield is 3% of the stock price, and it's growth rate is 7%. If the tax rate is .35%, what is the firm's cost of equity?

a) 10%
b) 6.65%
c) 8.95 %
d) More information is required.

13. Assume a corporation has earnings before depreciation and taxes of $100,000, depreciation of $40,000, and that it has a 30 percent tax bracket. What are the after-tax cash flows for the company?

a) $82,000
b) $110,000
c) $42,000
d) None of the above

Answer: A

Earnings before depreciation and ...

Solution Summary

This solution is comprised of a detailed explanation to answer what is the firm's cost of equity, what are the after-tax cash flows for the company, what is the internal rate of return, and what is the net present value of the project.

A man standing on a bridge 30m above the water throws a stone in a horizontal direction. Knowing that the stone hits the water 40m from a point on the water directly below the man determine (a)the initial velocity of the stone (b)the distance at which the stone would hit the water if it were thrown with the same velocity from a

A ball is thrown vertically upward with an initial speed of 22 m/s. Then, 0.67s later, a stone is thrown straight up (from the same initial height as the ball) with an initial speed of 37 m/s.
How far above the release point with the ball and stone pass each other? The acceleration of gravity is 9.8 m/s^2.
Answer in units

A stone of density 5g/cm^3 completely immersed in sea water is allowed to sink from rest. Calculate the depth to which the stone would sink in two seconds. Neglect effect of friction. Relative density of sea water = 1.025 and g = 980cm/s^2

A stone is dropped at t = 0. A second stone, with 3 times the mass of the first, is dropped from the same point at t = 190 ms. (a) How far below the release point is the center of mass of the two stones at t = 440 ms? (Neither stone has yet reached the ground.) (b) How fast is the center of mass of the two-stone system moving at

Stone Co. owns 4,000 of the 10,000 outstanding shares of Maye Corp. common stock. During 2007, Maye earns $120,000 and pays cash dividends of $40,000.
Stone should report investment revenue for 2007 of how much?

A stone is projected at a cliff of height h with an initial speed of 40.0 m/s, directed 60.0° above the horizontal. The stone hits the top of the cliff 6.10 s after it is launched. Calculate:
a. the maximum altitude of the stone.
b. the height of the cliff.
c. the stone's speed just before impact.

(See attached file for full problem description and equations)
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A stone is thrown vertically upwards so that its height, measured in feet, after t seconds is given by s(t) = 100t - 16t2. What is its initial velocity? Determine the maximum height of the stone and the time of flight of the stone.
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I need to write a program that will run in Code Blocks 10.05 that will:
Convert pounds (US) to Stone (UK)
- Take input from user
- Return ciphered answer to user
1 Pound = 0.0714285714 Stones

1) Luigi launches a stone vertically upward from the top of a cliff. The height of the stone above the base of the cliff is appoximated by the model h=65+10t-5t^2
where t is time in second and h is height in metres
a) how high is the stone above the base of the cliff after 3 seconds?
h = 65 + 10t - 5t^2
h = 65 +10(3) -

A stone is dropped from a height of 100m. At what height is half of its energy potential and half kinetic? What is the speed of the stone at this height?