Extra Credit Quiz Week 3 - Requires Respondus
LockDown Browser + Webcam
Due Jul 27 at 11:59pm Points 0 Questions 5
Available Jul 19 at 12am - Jul 27 at 11:59pm 9 days Time Limit 75 Minutes
Requires Respondus LockDown Browser
Instructions
Extra Credit. 5 problems 10 points each
Topics: cost of capital, NPV, IRR, payback, WACC
Open book; open notes. 75 minutes
Respondus lock-down browser, web cam.
Problems will appear one at a time - no backtracking
This quiz was locked Jul 27 at 11:59pm.
Attempt History
Attempt Time Score
LATEST Attempt 1 62 minutes 45 out of 0
Correct answers are hidden.
Score for this quiz: 45 out of 0
Submitted Jul 27 at 3:27am
This attempt took 62 minutes.
Question 1 pts
You must show all work including any formulas:
1/5
, 1. Calculate the various costs of capital given the following: the
company's tax rate is 25%, the bank charges 11% interest, the next
dividend paid will = $3.00, the market price of stock = $30.00 and the
growth rate = 2%, selling new common stock costs (flotation cost) =
10% a. cost of debt (4 points); b. cost of retained earnings (3
points); c. cost of common stock (3 points):
Your Answer:
a. Cost of debt
ATKd= Kd*(1-ISTR)
ATKd= 0.11*(1-0.25)
ATKd= 0.0825; ATKd= 8.25%
c. Cost of common stock
Kn= [D1/(Po-F)] + G
Kn= [3/(30-0.10)]+ 0.02
Kn= 0.1203; Kn= 12.03%
b. Cost of retained earnings
Ks= (D1/Po) + G
Ks= (3/30)+ 0.02
Ks= 0.12; Ks= 12%
Question 2 pts
Reminder: you MUST show work including the formula!
2. Calculate the Net Present Value of a project given the following
information (8 points ) AND would you recommend to management
that they accept the project (2 points)
The cost of capital has been estimated to be 10%
The value of cash in flows =$22,000
2/5
LockDown Browser + Webcam
Due Jul 27 at 11:59pm Points 0 Questions 5
Available Jul 19 at 12am - Jul 27 at 11:59pm 9 days Time Limit 75 Minutes
Requires Respondus LockDown Browser
Instructions
Extra Credit. 5 problems 10 points each
Topics: cost of capital, NPV, IRR, payback, WACC
Open book; open notes. 75 minutes
Respondus lock-down browser, web cam.
Problems will appear one at a time - no backtracking
This quiz was locked Jul 27 at 11:59pm.
Attempt History
Attempt Time Score
LATEST Attempt 1 62 minutes 45 out of 0
Correct answers are hidden.
Score for this quiz: 45 out of 0
Submitted Jul 27 at 3:27am
This attempt took 62 minutes.
Question 1 pts
You must show all work including any formulas:
1/5
, 1. Calculate the various costs of capital given the following: the
company's tax rate is 25%, the bank charges 11% interest, the next
dividend paid will = $3.00, the market price of stock = $30.00 and the
growth rate = 2%, selling new common stock costs (flotation cost) =
10% a. cost of debt (4 points); b. cost of retained earnings (3
points); c. cost of common stock (3 points):
Your Answer:
a. Cost of debt
ATKd= Kd*(1-ISTR)
ATKd= 0.11*(1-0.25)
ATKd= 0.0825; ATKd= 8.25%
c. Cost of common stock
Kn= [D1/(Po-F)] + G
Kn= [3/(30-0.10)]+ 0.02
Kn= 0.1203; Kn= 12.03%
b. Cost of retained earnings
Ks= (D1/Po) + G
Ks= (3/30)+ 0.02
Ks= 0.12; Ks= 12%
Question 2 pts
Reminder: you MUST show work including the formula!
2. Calculate the Net Present Value of a project given the following
information (8 points ) AND would you recommend to management
that they accept the project (2 points)
The cost of capital has been estimated to be 10%
The value of cash in flows =$22,000
2/5
