Start-up Industries is a new firm, which has raised $100 million by selling shares of stock. Management expects to earn a 24% rate of return on equity, which is more than the 15% rate of return available on comparable-risk investments. Half of all earnings will be reinvested in the firm.   a. What will be Start-up’s ratio of market value to book value?  b. How would that ratio change if the firm can earn only a 10% rate of return on its investments?

Q: 4. Suppose a company has a current dividend of $ 2 per share, a current price of $ 40 per share, and…

A: Answer 4: Information Provided: Current dividend = $2 Growth rate = 5% Current price = $40

Q: Your company is financed 30% with debt and 70% with equity. The internal rate of return on the…

A:

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A: Formulas:

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A: Here,

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Q: 16) You are told by your investment advisor that Laduma Co. is expected to earn R5 per share next…

A: “Hey, since there are multiple questions posted, we will answer first question. If you want any…

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