Question 17 Hindelang Inc. is considering a project that has the following cash flow and...
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Accounting
Question 17
Hindelang Inc. is considering a project that has the following cash flow and WACC data. What is the project's MIRR? Note that a project's MIRR can be less than the WACC (and even negative), in which case it will be rejected.
| WACC: | 12.25% | ||||
| Year | 0 | 1 | 2 | 3 | 4 |
| Cash flows | -$850 | $300 | $320 | $340 | $360 |
| 13.42% | ||
| 14.91% | ||
| 16.56% | ||
| 18.22% | ||
| 20.04% |
5 points
Question 18
You were recently hired by Scheuer Media Inc. to estimate its cost of capital. You obtained the following data: D1 = $1.75; P0 = $42.50; g = 7.00% (constant); and F = 5.00%. What is the cost of equity raised by selling new common stock?
| 10.43% | ||
| 8.50% | ||
| 12.24% | ||
| 11.33% | ||
| 9.97% |
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