Question: Firm A and Firm B have debt-total asset ratios of 35% and 25% and returns on total assets of 9% and 13%, respectively. What is the return on equity for Firm A and Firm B? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Q: What is basic earnings per share (EPS)?

A: Introduction:- Basic earning per share denotes amount of net profit attributable to each common…

Q: When is a firm's investment pool equal to the MARR?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: What are the factors favoring a high-dividend policy?

A: Dividend refers to portion of net earnings of the company that is shared with common stock holders…

Q: Mathematically define the dollar duration of equity.

A: The Dollar duration is measures in which the value of the dollar can change in the value of bonds…

Q: Which

A: Preferred stock is a special type of stock in which shareholder get Fixed dividends and does not…

Q: What is share capital retirement? What is the effect of this? Discuss.

A: Share Capital Share capital is the fund which are raised from the public for the operations of the…

Q: What are the basis of common stock valuation?

A: Common stock is defined as the security, which used to represent an ownership in the company. Common…

Q: What is the most likely impact on return on equity of an increase in operating expense margin, all…

A: Operating expenses are required to run the business. AN increase in operating expenses reduces the…

Q: ain why the required rate of return on a firm's assets must be equal to the weighted average cost of…

A: Weighted average cost of capital is the weighted cost of equity and weighted cost of debt after…

Q: How does the return on common equity show the relationship between net income and the common…

A: The return on equity is the percentage earned on the equity investment made by the company. It shows…

Q: What are the similarities and differences between an overall rate and an equity dividend rate?

A: Answer: Equity is nothing but the difference between asset owning values and liabilities against…

Q: What is the cost of equity in the levered company

A: A levered company has a mix of debt and equity in its capital structure. The company that obtains…

Q: Question

A: Prime Brokerage: Prime brokerage refers to a suite of specialized services provided by investment…

Q: Discuss whether the dividend growth model or the capital asset pricing model should be used to…

A: The dividend growth model and the capital asset pricing model are both methods that can be used to…

Q: What are the different types of equity capital? Give some examples?

A: Equity capital are the funds invested by the owners in the company. The equity holders of the owners…

Q: Why does have equity habve a higher vost of capital compared to debt?

A: Reasons why equity have higher cost of capital than debt is 1) Debt has tax advantages I,e tax…

Q: explain the strategies that enhance the return on equit

A: Return on equity is a very important financial ratio. This ratio is essentially a measure of…

Q: What is a stock’s volatility?

A: Stock Volatility:   Volatility is defined as a statistical measure of the dispersion of the returns…

Q: How do you call a strategy that separately examines capital market conditions and the investor's…

A: The strategy is called as “Integrated Asset Allocation Strategy”.

Q: 3. How large is the gap between Beta(Asset) and Beta(Leverage)? What is the impact of their…

A: Beta is a metric used by shareholders to correlate the uncertainty of a securities or portfolio to…

Q: What are the payout methods? Select all that apply.   Group of answer choices a. Bank loan b. Buyout…

A: Companies often pay out a percentage of their profits to shareholders as dividends, which can take…

Q: How do investment opportunities affect dividend policy?

A: The question is based on the concept of investment policy and its impact on dividend policy of a…

Q: Is cost of capital set by investors or managers?

A: Cos of capital (Coc) is rate of return required to make capital budgeting decisions for example,…

Q: What are the multiplier ways to calculate the cost of equity? Why are there multiply ways to…

A: There are multiple ways to calculate the cost of equity. We have to talk about them and see if they…

Q: What is the estimated cost of equity using thedividend growth approach?

A: Introduction: Dividend growth model is an approach which assumes dividends are that at a constant…

Q: Question:  To estimate the cost of equity we can use the Capital Asset Pricing Model (CAPM) or the…

A: In the given question we need to answer the following question : To estimate the cost of equity we…

Q: What constraints affect dividend policy?

A: Stability of earnings is one of the important factors influencing the dividend policy. If earnings…

Q: easier to calculate directly, the expected rate of return on the assets of a firm or the expected…

A: The return on assets states how profitable the assets of company are in generating the revenue. To…

Q: oes cost

A: Cost of capital : The required return on capital, especially as the expense of developing a new…

Q: To identify the cost of equity, which models are better: The dividend growth model or CAPM-derived…

A: The question is based on the comparative study of the methods to derive cost of equity. Cost of…

Q: How does Net Proft Margin, ROA, and ROE determine a firm's financial profitability?

A: Financial profitability refers to that financial situation of a company in which its revenues are…