Start with the partial model in the file Ch11 P18 Build a Model.xlsx. The stock of Gao Computing sells for $60, and last year's dividend was $2.83. Security analysts are projecting that the common dividend will grow at a rate of 8% a year. A flotation cost of 13% would be required to issue new common stock. Gao's preferred stock sells for $33.33, pays a dividend of $2.70 per share, and new preferred stock could be sold with a flotation cost of 10%. The firm has outstanding bonds with 20 years to maturity, a 12% annual coupon rate, semiannual payments, and $1,000 par value. The bonds are trading at $1,171.59. The tax rate is 25%. The market risk premium is 6%, the risk-free rate is 6.5%, and Gao's beta is 1.1. In its cost-of-capital calculations, Gao uses a target capital structure with 50% debt, 15% preferred stock, and 35% common equity. The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required analysis to answer the questions below. Do not round intermediate calculations. Round your answers to two decimal places. Download spreadsheet Ch11 P18 Build a Model-37756e,xlsx a. Calculate the cost of each capital component-in other words, the after-tax cost of debt, the cost of preferred stock (including flotation costs), and the cost of equity (ignoring flotation costs). Use both the CAPM method and the dividend growith approach to find the cost of equity. b. Calculate the cost of new stock using the dividend growith approach. % c. Assuming that Gao will not issue new equity and will continue to use the same target capital structure, what is the company's WaCC? %

Answers

Answer 1

To calculate the cost of each capital component, we need to consider the after-tax cost of debt, the cost of preferred stock (including flotation costs), and the cost of equity (ignoring flotation costs).

a) After-tax cost of debt: Since the bonds are trading at a premium, we need to calculate the yield to maturity (YTM). Using the bond's price, coupon rate, and time to maturity, we can find the YTM. Then, we multiply the YTM by (1 - tax rate) to get the after-tax cost of debt.

b) Cost of preferred stock: We need to consider the preferred stock's price, dividend, and flotation cost. Using these values, we can calculate the cost of preferred stock.

c) Cost of equity: We can calculate the cost of equity using both the CAPM method and the dividend growth approach. For the CAPM method, we use the risk-free rate, market risk premium, and Gao's beta. For the dividend growth approach, we use the dividend per share, dividend growth rate, and Gao's stock price.

To calculate the cost of new stock using the dividend growth approach, we can use the projected dividend per share and the stock price.

Assuming Gao will not issue new equity, and using the same target capital structure, we can calculate the weighted average cost of capital (WACC). WACC is the weighted average of the cost of each capital component, considering their proportions in the capital structure.

By following these steps, you can determine the cost of each capital component and the WACC for Gao Computing. Remember to use the given data and formulas provided in the file to perform the calculations accurately.

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Related Questions

as the reader, you can figure out the writer's ____ based on his or her word choice and sentence structure a. purpose b. audience c. tone d.structure

Answers

Answer:

purpose

Explanation:

a writer always has a purpose for writing is it to make the audience understand?to make them entertained any of those and many more

Answer:

It Would Be tone

Explanation:

WILL GIVE BRAINLIEST!!!!!!!!!
This type of power system is often used in the health field and food industry due to its system cleanliness.

Mechanical

Fluid

Electrical

None of these

Answers

Answer:

fluid

Explanation:

How can I do 3.6 code practice

Answers

Answer:

a = int(input("Enter a number: "))

print("Largest: " + str(a) )

b = int(input("Enter a number: "))

print("Largest: " + str(max(a, b)))

c = int(input("Enter a number: "))

print("Largest: " + str(max(a, b, c)))

d = int(input("Enter a number: "))

print("Largest: " + str(max(a, b, c, d)))

e = int(input("Enter a number: "))

print("Largest: " + str(max(a, b, c, d, e)))

f = int(input("Enter a number: "))

print("Largest: " + str(max(a, b, c, d, e, f)))

Explanation:

Here you go let me know if this works!

9. Mrs. Cunningham says that the real significance of Grade 6 is that it marks the beginning of self-awareness in the children about their roles as social creatures.​

Answers

Answer:

yes, the answer is true

TRY IT Choose the Right Technology MP3 player Widescreen laptop computer Smartphone Tablet computer with wireless Internet Suppose your parents are planning to take you and your younger brother on a tour of several European countries. You are in charge of choosing a device for your family's vacation that will allow you to look up where to eat, what to see, and what to do. You will need something that you, your parents, and your younger brother can use. The device needs to accommodate your dad's large hands and your mother's request that it fit in her handbag, which is about half the size of a backpack O Digital camera Audio recorder DONE Which one of the following devices would you choose to meet those requirements?​

Answers

the answer is:

d. tablet computer with wireless internet.

true or false computer cannot do work by itself​

Answers

Answer:

True

Explanation:

Because it cannot operate without electricity and humans.

Mark me as brainlist.

Which of the following lists contains the five essential elements of a computer? Group of answer choices: 1. inputs, returns, programs, processes, and storage 2. language, software, hardware, code, and development 3. inputs, outputs, programs, processes, and storage 4.binary, code, inputs, processes, and storage

Answers

I think it’s 3 sorry if I’m wrong

Answer:

The answer is "C"

Explanation:

inputs, outputs, programs, processes, and storage

Jason is creating a web page for his school's basketball team. He just finished creating his storyboard. Which tool should he use to start coding?

Storyboard
Text editor
Web browser
Word processing document
You must check the box below prior to sub

Answers

Jason should use a text editor

Answer:

text editor

Explanation:

examples of algorithm

Answers

Answer:

1] Binary Search.

2] Merge Sort.

3] Adding and Removing From a Linked List.

Explanation:

Question #4
Multiple Choice
What type of address is used at the network access layer to uniquely identify a piece of network hardware?
O MAC address
O frame
IP address
O datagram
PLEASE HELP

Answers

The  type of address is used at the network access layer to uniquely identify a piece of network hardware is known to be called the MAC address.

Check more about the address below

What is a MAC address?

A MAC (is known to be called the Media Access Control) address, and it is one that is often seen  as a hardware or physical address. It is one that is said to be very special  12-character kind of alphanumeric attribute/ characteristic that is known to be used to tell about individual electronic devices on any kind of network.

Note that a good example of a MAC address is said to be: 00-B0-D0-63-C2-26. It is seen as the physical address and that is is also called a media access control, or MAC, address  and it helps to tell a device to another devices on similar  local network.

Therefore, based on the above, one can say that The  type of address is used at the network access layer to uniquely identify a piece of network hardware is known to be called the MAC address.

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Which of the following is NOT a legal variable name?
%information
appointment_hour
O grade3
firstName

Answers

0 grade3 is NOT because it’s not a variable name

Answer:

a

Explanation:

a

what does snap do need the answer now

Answers

It’s a social networking site made to communicate amongst friends it also allows you to post little bits of your day . Each post lasts about 24 hours.

When should the Clean Up command be used?
to move all message conversations to the deleted items folder
to ensure that no future messages of that type are delivered to him
to remove redundant messages to free up space in his inbox
to clean up the deleted items folder and permanently delete messages

Answers

Answer:

the correct option in c

Explanation:

Answer: The person below me is right, its C.

Explanation: I did it on Edg and I got it right.

Which term means a device that converts one voltage to another?

current

adapter

voltmeter

digital signal

Answers

Answer:

Adapter

Explanation:

The term means a device that converts one voltage to another adapter. The correct option is B.

What is an adapter?

An adapter is a physical device that allows one hardware or electronic interface to be adapted (accommodated without losing function) to another.

An adapter in a computer is typically built into a card that can be inserted into a slot on the computer's motherboard.

An adapter, also known as an adaptor, is a device that converts the characteristics of one electrical device or system to those of another, otherwise incompatible device or system.

Some change the power or signal attributes, while others simply change the physical shape of one connector to another.

The term refers to a device that converts one voltage to another.

Thus, the correct option is B.

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match the following of computer​

Answers

Where’s the question/page?

Write a program that asks the user for a positive 3-digit number. Then print the number in reverse.

Answers

In python 3:

number = input("Enter a positive 3-digit number: ")

while int(number) < 0 or len(number) != 3:

   number = input("Enter a positive 3-digit number: ")

print(number[::-1])

I hope this helps!

What is the mode of 18, 18, 15, 18, 18, 24, 21, 21, 24, and 14?
18
18.5
21
22.3

Answers

Answer: 18

Explanation:

Answer:

18

Explanation:

Compared with aerospace engineers, astronomers are which of the following?

a. more likely to obtain a graduate degree
b. more likely to be employed by private industry
c. more likely to be employed by a government agency
d. more likely to obtain a bachelor’s degree

Answers

Answer: more likely to obtain a graduate

Compared with aerospace engineers, astronomers are more likely to obtain a graduate degree.

I'm 200% sure that's the one.

The purpose of an income statement is to identify the net income of the business true or false

Answers

True;
an income statement is a business’s net income-
Net income is the income of the businesses minus the expenses the goods it sold cost.

It may be necessary to work more than 40 hours a week as a salaried employee when ______.

Answers

Answer:

you hold an executive, administrative, or professional position in which you supervise more than one employee and earn a minimum of $455 per week.

Explanation:

According to the Fair Standards Labor Act, salaried workers in the United States are entitled to overtime pay when they work for more than 40 hours in a week.

However, there are some exemptions to this. If a salaried worker in the United States holds a top position such as the above-listed, earns more than $455 in a week and he supervises a host of workers, he does not qualify for overtime pay. His job role already demands that he would have to work overtime most times. For this reason, he should not expect extra pay.

Which of the following is a camera problem that dirt can cause?

Scratched lens
Scratched mirrors
Damaged sensors
All of the above

Answers

Answer:

all of the above

Explanation:

hope this helps:)

Answer:

all of the above

Explanation:

i took the test and got it right

what type of image digital image is shown here?​

Answers

Answer:

2,4,6,8,10,12,14,16,18,20

Explanation:

who need best OCR app . I will help you.​

Answers

Answer:

i do

Explanation:


What is the total number of counts for
one whole note plus one dotted half
note plus two quarter notes minus one
half note multiplied by one half note?

Answers

Answer:

i belive your answer would be 32 because

Explanation:

whole note =4 beats

dotted half note =3 beats

and 2 quarter notes get =8 beats

all of that added together equals 18 minus half note =2 beats

which=16 times a half note which =2 would give you your answer 32

Answer:

I would say its 32 because

Explanation:

whole note =4 beats

dotted half note =3 beats

and 2 quarter notes get =8 beats

all of that added together equals 18 minus half note =2 beats

which=16 times a half note which =2 would give you your answer 32

How to connect an Apple Watch series 3 to your iPhone (ASAP)

Answers


Im not sure but okay

help please hurrry asap I WILL MARK BRAINLEST

Adam has decided to add a table in a Word doc to organize the information better.

Where will he find this option?

1 Insert tab, Illustrations group
2 Insert tab, Symbols group
3 Insert tab, Tables group
4 Design tab, Page Layout group

Answers

Answer:

4) design tab, Page layout group

Explanation:

Answer:

3 insert tab, tables group

What does Snap do?

enables you to create a shortcut to a program, document, or file
enables you to temporarily hide all open windows and view the desktop
enables you to close all windows but the one you’re viewing
enables you to resize open windows

Answers

Answer:

Snap enables you to resize open windows,

Explanation:

Snap enables you to resize open windows, It is convenient when you want to see two windows simultaneously (side by side).

To do this, drag the desired window the left\right until the cursor reaches to the edge of the screen and then release the mouse.

The window will snap into place.

Please help with this error message

Answers

This likely has nothing to do with your for loop. Before we get into the error, let's discuss arguments.

Your methods are given arguments when you declare them. For instance, your shuttle method has two arguments.

public void shuttle(int spaces, int beepers){

}

spaces and beepers are the two arguments. When you call these methods, for instance,

shuttle();

You must include the arguments.

shuttle(1,2);

You have these errors because you're not supplying the methods with arguments.

Which type of cyber attack attempts to lure victims to share their personal and financial information?

Answers

The cyber attack that attempts to lure victims to share their personal and financial information is called PHISHING.

What did Charles Babbage design in 1822 to substitute values in polynomial equations? ENIAC TRADIC Analytical Engine Difference Engine

Answers

Answer:

Difference engine

Explanation:

Babbage began in 1822 with what he called the difference engine, made to compute values of polynomial functions. It was created to calculate a series of values automatically. By using the method of finite differences, it was possible to avoid the need for multiplication and division.

Answer:

Analytical engine

Explanation:

Other Questions
John and Jim have accounts at bank as follows:CD in John's name only: $ 150,000Mutual fund in John's name only: $ 200,000Money market deposit account in Jim's name: $260,000Joint savings: $ 298,000Under the protection of the FDIC, how much of their money is insured? why do gay people dress funny Strategy isA. a complex concept that involves many different processes and activities within an organization.B. involving goals and objectives that an organization needs to achieve to be successful in the marketplace.C. long-term in nature.D. all the above What factors make Central Asia isolated? The individual Sun Mei Ling is a 32-year-old microbiologist working in Beijing in an R&D centre belonging to a major German pharmaceutical company. Before getting this job, she worked in a government laboratory. Her work involves testing new substances, and her role is critical in many projects. She works daily with Helga Schreiber, a German project manager with a similar scientific background. They are both members of a team of scientists, most of whom are Chinese nationals but also including about a third who are expatriates, mainly from Germany and other European countries. Sun Mei Ling is a quiet person who takes pride in the quality of her work. She took this new job because it is much better paid. However, she finds that it is not clear what is expected of her, and she is becoming increasingly frustrated, although she does not show this. The team Helga Schreiber, aged 35, has been expatriated to China for a 3- to 4-year assignment. This is her first long-term international posting. Back in Germany, in the main R&D centre, Helga quickly rose to become a senior project manager with responsibility for some major initiatives. China is critical to the company's future, and the new R&D centre in Beijing has been set up to adapt products to the local market and innovate expressly for China. Helga has recruited Sun Mei Ling to take over responsibility for microbiological lab testing. She wants to free herself up to concentrate on building a network with Chinese labs and external partners. Six months later, she is finding it very difficult to get Sun Mei Ling to take the initiative and run things on her own. She thinks she has explained in detail what needs to be done but finds that Sun Mei Ling does it just once and then waits to be told the next time again. The organization The R&D centre in Beijing is finding it challenging to maximize the potential of its Chinese staff. The centre is run by a German with international experience but not in China. Three years after setting up the centre, the results have been disappointing, and head office in Hamburg is wondering whether this investment was worthwhile. It seems that the two groups - Chinese and expatriates - have not found a way to work together. Reflections Sun Mei Ling (speaking to her husband): 'Helga leaves me on my own. There is often nobody else in the lab. I don't like to complain, but I don't have a good feeling.' Helga to the head of the centre: 'This is not working. I want Sun Mei Ling to take the initiative. I want to feel confident that I can leave her alone and that she will get the job done. Every time I come back, I have to start again and explain it all over. She seems very clever but doesn't take responsibility.' The head of the centre: 'Our European scientists are used to getting on with their work. They don't like supervision much - in fact, they resent it if you interfere. I don't know how to motivate the Chinese staff. They keep themselves apart.' Questions to consider 1. Looking at the German and Chinese culture: why did the situation get as tricky as it is? 2. What could Sun Mei Ling do to improve her working situation? 3. What could Helga do to achieve her objectives? The initial state of a quantity of monatomic ideal gas is P = 1 atm, V = 1 liter, and T = 373 K. The gas is isothermally expanded to a volume of 2 liters and is then cooled at constant pressure to the volume V. This volume is such that a reversible adiabatic compression to a pressure of 1 atm returns the system to its initial state. All of the changes of state are conducted reversibly. Calculate the value of V and the total work done on or by the gas. 1. Steady Company's stock has a beta of 0.25. If therisk-free rate is 6.1% and the market risk premium is 7.1%, whatis an estimate of Steady Company's cost of equity?Steady's cost When answering an essay question, it is best toa. always begin your answer with a questionb. try to make an outline in the marginc write as quickly as possible, using abbreviations so that you can finish on timed. all of the above Which is the tight constraint? A. 2X1+X23 B. 2X1+8x216 C. 5x1+6x260 D. X10 You are the project manager responsible for planning to createthe new iphone model. Create a first draft of what this workbreakdown structure could look like for this project. Makeassumptions where Great Adventures Continuing Case [The following information applies to the questions displayed below.] Tony and Suzie see the need for a rugged all-terrain vehicle to transport participants and supplies. They decide to purchase a used Suburban on July 1, 2025, for $15,800. They expect to use the Suburban for five years and then sell the vehicle for $6,400. The following expenditures related to the vehicle were also made on July 1,2025 : - The company pays $2,750 to GEICO for a one-year insurance policy. - The company spends an extra $6,800 to repaint the vehicle, placing the Great Adventures logo on the front hood, back, and both sides. - An additional $2,950 is spent on a deluxe roof rack and a trailer hitch. The painting, roof rack, and hitch are all expected to increase the future benefits of the vehicle for Great Adventures. In addition, on October 22,2025 , the company pays $2,300 for basic vehicle maintenance related to changing the oil, replacing the windshield wipers, rotating the tires, and inserting a new air filter. VP7-1 (Algo) Great Adventures Continuing Case Part 4 Record the depreciation expense and any other adjusting entries related to the vehicle on December 31, 2025. (if no entry is quired for a transaction/event, select "No Journal Entry Required" in the first account field.) Services is a product that usually involves a single opportunity totransmit or communicate the message.true or false Roarie Ice Cream Shop sells specialty ice cream in three flavors: Vanilla, Chocolate and Strawberry. It sold 19.000 gallons last year. For every five gallons of ice cream sold, one gallon is Strawberry and the remainder is split evenly between Vanilla and Chocolate. Fixed costs for Roarie Ice Cream Shop are $50,400 and additional information follows: Vanilla Chocolate Strawberry Sales price per gallon $7.25 $8.25 $6.25 Variable cost per gallon $1.50 $3.25 $3.75 The sales mix percentage of Strawberry based upon gallons is O 71%. O 40%. O 75%. O 20%. 1825 equal 182 times Assume the following: The variable portion of the predetermined overhead rate is $1.50 per direct labor-hour. The standard labor-hours allowed per unit of finished goods is 3 hours. The actual quantity of labor hours worked during the period was 43,250 hours. The total actual variable manufacturing overhead cost for the period was $63,000. The company produced 15,000 units of finished goods during the period. What is the variable overhead rate variance? Multiple Choice O O $1,875 F $1,875 U $4,500 U $4,500 Name the narrow bridge of land that connects north and south america HeLp aSAp!!! If the speed and distance of an object are given, and I need to find the time, I will...A. add the speed and distanceB.divide the speed and distanceC. multiply the speed and distance IMA members have a responsibility to comply with and uphold the standards of Competence, Confidentiality, Integrity, and Credibility.Briefly describe each. Solve for v. 23= -81-7+2v group of answer choices color brown to reddish-brown hardness [ choose ] cleavage [ choose ] luster [ choose ] name hematite