Another has a current share price of $44 and a total of 19 million shares outstanding. The company debt was a total $885 million when it was released. (assume no flotation costs). These outstanding bonds are currently priced to yield 4.9% while quoting at 88.5% of total face value. The company recently paid a dividend to common stock holders of $4.08 and anticipates growing the dividend at a constant rate of 6% per year indefinitely. If the corporate tax rate is 30%, what is the weight(percent) of debt of Some Company? 53.64% 49.69% 0 48.58% 54.75% 52.53% 51.42% 50.70%
Another has a current share price of $44 and a total of 19 million shares outstanding. The company debt was a total $885 million when it was released. (assume no flotation costs). These outstanding bonds are currently priced to yield 4.9% while quoting at 88.5% of total face value. The company recently paid a dividend to common stock holders of $4.08 and anticipates growing the dividend at a constant rate of 6% per year indefinitely. If the corporate tax rate is 30%, what is the weight(percent) of debt of Some Company? 53.64% 49.69% 0 48.58% 54.75% 52.53% 51.42% 50.70%
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Another has a current share price of $44 and a total of 19 million shares outstanding. The company debt was a total $885 million when it was released. (assume no
flotation costs). These outstanding bonds are currently priced to yield 4.9% while quoting at 88.5% of total face value. The company recently paid a dividend to
common stock holders of $4.08 and anticipates growing the dividend at a constant rate of 6% per year indefinitely. If the corporate tax rate is 30%, what is the
weight(percent) of debt of Some Company?
53.64%
49.69%
0 48.58%
54.75%
52.53%
51.42%
50.70%
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