Maddux Corporation has EBIT of $725,000 per year that is expected to continue in perpetuity. The unlevered cost of equity for the company is 11 percent and the corporate tax rate is 24 percent. The company also has a perpetual bond issue outstanding with a market value of $1.6 million.  What is the value of the company?

Q: Alex is considering one of two options for reducing her heating bill during the winter: New windows…

A: Two options have been given. Using PW or AW or FW, we have to find the better option. Secondly, we…

Q: what is enterprise value and enterprise value as a multiple EBITDA

A: Enterprise value-It is the measure of a company's total value. Enterprise value to EBITDA multiple…

Q: Calculate the annual interest that you will receive on the described bond.   A ​$1000 Treasury bond…

A: The Price of the Bond is calculated with the help of following formula  Price of Bond = Face Value…

Q: Giovanna gave a note amounting to Php15,000 to Alessandro on October 12, 2011 which matures after 2…

A: Simple interest is very simple straight forward that means there in no compounding of interest and…

Q: A loan is to be amortized at 8% compounded semi-annually by paying Php2,375 every six months for 12…

A: Time Period (Years) 12 Interest Rate (RATE) 8% Semi-Annual Payment (PMT)  PHP   2,375.00

Q: What interest rate must Bertha earn on her savings if she plans to make equal semiannual savings…

A: Data given: pmt= $12941 period= semiannual N=9 years nper=9*2=18 FV= $ 359,268

Q: Given the following information, determine the beta coefficient for Stock L that is consistent with…

A: A security's or investment portfolio's sensitivity or connection to changes in the overall market is…

Q: nnuity Payment Payment Frequency Time Period (years) Nominal Rate (%) Interest Compounded Present…

A:

Q: Consider the two savings plans below. Compare the balances in each plan after 6 years. Which person…

A: Future Value: The worth of a current asset at some point in the future based on an estimated rate of…

Q: OUR PARENTS OBTAIN A 2021 MODEL OF TOYOTA FORTUNER FOR P1,500,000.00. THE AGREED PAYMENT IS 5 YEARS…

A: A person is not able to always afford buying a high priced thing like a car or a house. Such items…

Q: 4. Justin receive 10, 000 from a life insurance policy. He uses the fund to purchase two different…

A: An annuity provides for future periodic payments in return for a lump sum amount today. There are…

Q: Tomás bought a house with a mortgage of $328,300. The mortgage is being finance interest rate of…

A: loans are paid by the monthly payments and these payments carry the payment of loa amount and…

Q: Solve the problem. Monthly Payment per $1000 of Mortgage The Jacksons' gross monthly income is…

A: Total debt ratio is very important in deciding the loans that can be offered to the the borrower…

Q: For the intrinsic value, why is the cashflow divided by (10%-6%

A: Intrinsic value of a stock or any other financial security is the fundamental value of that stock or…

Q: Explain in detail the E-I-C analysis approach

A: EIC Analysis Approach: EIC Analysis is called the Economic Industry Company Analysis and is a type…

Q: Joan's mother forgot that her 25,000 13th month pay 10 years ago was invested to an instrument that…

A: Future Value = Present Value * (1+r)n Where, r = interest rate n = time period

Q: Suppose Jack, president of Heart Limited has hired you to advise on the firm’s cost of capital.…

A: Data given: Total liabilities=$ 8 million Total interest expense for the coming year will be about…

Q: Stephanie Carter has been gifted a sum of $50,000 by her grandparents on completing her graduation…

A: With current dividend (D), constant growth rate (g) and required rate (r), the present value per…

Q: A stock's returns have the following distribution: Demand for the Company's Products Probability of…

A: Demand for theCompany's Products Probability of this Demand Occurring Rate of Return if this Demand…

Q: Assume a high demand for the product and by-products that all produced goods are sold each year…

A: Internal rate of return (IRR) It is a capital budgeting tool to decide whether the capital project…

Q: 2. Efficient portfolios Figure 8.11 purports to show the range of attainable combinations of…

A: First let us define an efficient frontier. An efficient frontier gives the graphical representation…

Q: The Sisyphean Corporation is considering investing in a new cane manufacturing machine  that has an…

A:

Q: Use the following data to create a complete balance sheet. All accounts must be correctly labeled…

A: Balance Sheet: It is one of the financial statements that show the organization's current financial…

Q: Jacqueline purchased an interest-bearing promissory note for $13,000.00 at 3.00% p.a., due in 120…

A: Information Provided: Promissory note = $13,000 Interest rate = 3.00% Due Period = 120 days…

Q: investment has an installed cost of $532,800. The cash flows over the four-ye the investment are…

A: Net present value is the difference between the present value of cash flow and initial investment…

Q: arge, well-known public companies can reduce the time required to register and issue securities by…

A: When a company offers its shares for sale to the public it has to register and then issue securities…

Q: What annual interest rate is earned by a 17-week T-bill with a maturity value of $1,700 that sells…

A: Maturity Value is $1,700 Time period is 17 weeks Selling price is $1,680.88 To Find: Annual…

Q: The most important rule for establishing a savings plan is to Group of answer choices pay yourself…

A: There are various rules for establishing a savings plan. Some of them have been listed in the…

Q: Calculate the total present value at time 0 of a payment of £257 paid at time 4 and a payment of £67…

A: Using the PV formula given below, we can determine the Present value of an amount. PV = FV(1+r)n…

Q: The anwswer is not correct

A: Here, Annual deposits = $1,400 Annual interest rate = 5% Total years to annual deposits = 10 years…

Q: Dawson Electronics is a manufacturer of high-tech control modules for lawn sprinkler systems.…

A: Your capacity to see into the future is entirely what determines how well you can forecast your…

Q: Explain the concept of predicting the firm's future requirements.

A: Making reasonable predictions about particular company measures, such as sales growth, or forecasts…

Q: Compute the IRR, NPV, PI, and payback period for the following two projects.  Assume the required…

A: Given,  Cashflows of Project A Cashflows of project B

Q: 12. Cameron Industries is purchasing a new chemical vapor depositor in order to make silicon chips.…

A: Incremental free cashflows for year 2 =[ ( Gross Profits - Associated costs - depreciation ) * (1…

Q: Abdul has a debit card linked to a checking account with an available balance of $1480. He also owes…

A: Data given: Checking account balance=$1480 Amount owed to credit card= $1030 Credit card limit=$2400

Q: If interest on a savings account is compounded semiannually, the effective rate of interest will…

A: In nominal interest is like simple interest but there is no compounding , in simple interest there…

Q: Ind Times -Interest-earned(TIE)

A: Times interest earned is an important leverage ratio. This ratio is also called the interest…

Q: Provide one example of the following stakeholder groups possible response to risk: Employees…

A: The stakeholders are all such entities who will be impacted by operations of company and they are…

Q: $100 8. $225 $297 $186 $198 Find the stock turnover at retail and at cost for the following. Round…

A: As per Bartleby guidelines, If multiple questions are posted, only the first 1 question will be…

Q: You plan to analyze the value of a potential investment by calculating the sum of the present values…

A: Calculated Value of Investment: It refers to the total present value of the investment calculated…

Q: Problem #1. You invested $150 at the end of every month for 10 years at 7% interest compounded…

A: Monthly Investment (C) = $150 Monthly interest rate (r) = 0.00583333333333333 (i.e. 0.07 / 12)…

Q: DIRECTIO The Joie de Vivre Co. received the promissory notes listed below during the last quarter of…

A: Second Note: Face Amount = $8,000 Terms = 60 Days Interest Rate = 6%

Q: James Madison Ltd. expects a income of 200,000. The comp 5% of 1,000,000 bonds payab equity…

A: In the net income approach we calculate the value of equity and than we add debt to that and get the…

Q: If we were trying to compare CA deaths vs. National deaths, do we have enough data to accurately…

A: Trend measures the increase/ decrease in value over a period. It is calculated as shown below.…

Q: Suppose a firm’s last dividend was $1.10 (D0) and that it will grow by 10 cents per year over the…

A: Dividend discount model It is used to value of a share. Under dividend discount model, the present…

Q: How much should be invested now at 6.7% compounded annually to have $43,000 in 20 years?

A: As per Bartleby guidelines, If multiple questions are posted, only the first 1 question will be…

Q: Quantitative Problem: You own a security with the cash flows shown below. 0 $ 1 2 3 4 0 640 375 250…

A: Required return = 10% or 0.10   Present value is the discounted value of all the future cash inflows…

Q: Assume the three-period binomial model (t = 0, 1, 2, 3) where S0 = 4, u = 2, d = 1/2 and r = 1/4.…

A: A method for valuing options was created in 1979 and is called the binomial option pricing model. 1…

Q: 9. Stocks that don't pay dividends yet Goodwin Technologies, a relatively young company, has been…

A: Formula to calculate Horizon value Po = D0 * (1+g)/ (R-g)   Where, P0 = Stock value D0 = Current…

Q: Conduct the economic feasibility analysis to find out the overall NPV, ROI and breakeven point of…

A: ROI represents the return provided by investment, it is a comparison of the profit earned on the…