Chapter 8 Questions Question 1 1a Book Value Debt /Equity = Book Value of Debt /Book Value of Equity Book value of debt Book value of equity D/E 2500 2500 1 Shares Outstanding Market...
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Chapter 7 Questions Question 6 Question 6 a class A stock Class A share price Class B stock Class B share price Value of Equity 50,000 100 100,000 90 14000000 b Value of debt Value of equity Debt...
Chapter 6 Questions Question 3 Question 3 a Initial investment Per year cost Period Opportunity Cost NPV EAC $ (12,000.00) $ (5,000.00) Infinite 10% $ (17,000.00) $ (1,700.00) b Initial...
Chapter 5 Questions Question 1 1 Average Book Value and EBIT for Each Year Year Opening Book Value (A) Annual Depreciation [(25 – 10)/5] (B) Closing Book Value (C = A – B) Average...
Risk and Return Analysis Assessment of the riskiness of Tesla’s stock Tesla’s stock is significantly risky because it has a high beta. Tesla’s beta is 1.47, indicating the...
Chapter 3 Questions Question 1 The following table lists the stock prices for Microsoft from 1989 to 1998. The company did not pay any dividends during the period Year Price (dollars) 1989 1.20 1990...