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ioda
2 years ago
14

Please help me on this question

Mathematics
2 answers:
Serggg [28]2 years ago
7 0
    -4 = 8m + 18n
-18n = 8m + 4
 /-18    /-18  /-18
     n = 8m/-18 + 4/-18
     
I'm not sure so yeah
Vikentia [17]2 years ago
7 0
-4 = 8m + 18n (Original problem)
-8m -8m. (Subtract 8m from both sides)
-4 -8m = 18n (Divide both sides by 18)
-4 -8m/18 =n (Answer)

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Answer:

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Scenario 2 has WACC of 10.33%

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WACC=Ke*E/V+Kp*P/V+Kd(after tax)*D/V

Ke is the cost of equity =13%

Kp is the cost of preferred stock=10%

Kd(after tax) is the cost of debt of 8% adjusted for tax as below:

Kd(after tax )=Kd(before tax)*(1-t)

t is the tax rate of 30% or 0.3

Kd(after tax)=8%*(1-0.3)=5.60%

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P is the value of preferred stock which is $1.2 million and $2.2 million respectively

D is the value of debt which is $5 million and $2 million

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Scenario 1 WACC

WACC=13%*1.8/8+10%*1.2/8+5.6%*5/8=7.93%

Scenario 2 WACC

WACC=13%*3.8/8+10%*2.2/8+5.6%*2/8=10.33%

7 0
1 year ago
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As given,  

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2 years ago
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