Suppose a firm has 51 million shares of common stock outstanding and tencandidates are up for election to eight seats on the board of directors.a. If the firm uses cumulative voting to elect its board, what is the minimumnumber of votes needed to ensure election to the board?b. If the firm uses straight voting to elect its board, what is the minimumnumber of votes needed to ensure election to the board?(For all requirements, enter your answers in dollars, not millions of dollars.)a.b.Minimum number of votesMinimum number of votes10,800,00125,500,001

Common stock is the finance in equity which represents the ownership in a company. When any…

Answered: Suppose a firm has 51 million shares of…

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

See similar textbooks

Similar questions

Mr. Z is allotted 1,400 shares, at Rs.1,200 a share, in an IPO which has safety-net arrangement. If after 3 months of the IPO the share price is Rs. 1300, what may be the maximum protection Mr. Z will get ?
Starware Software was founded last year to develop software for gaming applications. The founder initially invested $700,000 and received 9 million shares of stock. Starware now needs to raise a second round of capital, and it has identified a venture capitalist who is interested in investing. This venture capitalist will invest $1.20 million and wants to own 13% of the company after the investment is completed. a. How many shares must the venture capitalist receive to end up with 13% of the company? What is the implied price per share of this funding round? b. What will the value of the whole firm be after this investment (the post-money valuation)? a. How many shares must the venture capitalist receive to end up with 13% of the company? The venture capitalists will receive million shares. (Round to three decimal places.)
Finding the WACC. Monica is the CFO of Cooking for Friends (CFF) and uses the pecking order hypothesis philosophy when she raises capital for company projects. Currently, she can borrow up to $450,000 from her bank at a rate of 7.75%, float a bond for $800,000 at a rate of 10%, or issue additional stock for $1,500,000 at a cost of 15%. What is the WACC for CFF if Monica chooses to invest A. $900,000 in new projects? B. $200,000 in new projects? C. $2,750,000 in new projects?
2. An analyst for Acme, R. Runner, has recommended that Peter the Anteater purchase shares in a private firm (a firm that is not traded on any exchange) called Dynamite Corp. Dynamite has 30% debt and 70% equity. R. Runner believes that Dynamite will generate a return of 10% over the next year. Since Y. Lee is new to the job, he decides to do a little research on his own. He finds a company, Explosions Unlimited, that has very similar business as Dynamite. Explosions has an equity beta of 1.05 and is composed of 40% debt and 60% equity. Should Peter the Anteater buy the stock? The expected return on the market is 12% and the expected risk-free rate is 5%.
Suppose, you own 2,000 shares in a company with 5,000 shares outstanding. There are 8 directors up for election via cumulative voting. How many directors can you elect?" 3 2 1 5 4
Your study group comprises of five members: John, Mary, Connor, Laurel and Christopher. They have beenstudying for an upcoming end-of-term exam. As a part of their preparation, they use session themes. Each memberof the study group provides a catch-phrase related to the theme around which they hold a discussion to sift thebest argument. Currently the theme that they are working with is: Theories about Investors’ dividend preferences.The following catch-phrases are provided by the team members:John: The homemade dividend strategy argues that investors impose their dividend preference on the firm.Mary: The bird-in-hand theory suggests that a company can reduce its cost of equity capital by reducing itsdividend payout ratio.Connor: A company can always increase its stock price by increasing its dividend payout ratio.Laurel: An increase in a firm's inclination to pay dividends may be because of a decline in profitable investmentopportunities in the future.Christopher: Relevant or not,…
Please show all equations and work as needed. Make the correct answer clear. If possible, please type work so it can be copied. Thank you.
Suppose a firm has 16 million shares of common stock outstanding and five candidates are up for election to four seats on the board of directors. a. If the firm uses cumulative voting to elect its board, what is the minimum number of votes needed to ensure election to the board? b. If the firm uses straight voting to elect its board, what is the minimum number of votes needed to ensure election to the board? (For all requirements, enter your answers in whole numbers, not millions.) a. b. X Answer is com plete but not entirely correct. Minimum number of votes Minimum number of votes 12,800,001 X 8,000,001 X
Starware Software was founded last year to develop software for gaming applications. The founder initially invested $800,000 and received 12 million shares of stock. Starware now needs to raise a second round of capital, and it has identified a venture capitalist who is interested in investing. This venture capitalist will invest $1.00 million and wants to own 13% of the company after the investment is completed. a. How many shares must the venture capitalist receive to end up with 13% of the company? What is the implied price per share of this funding round? b. What will the value of the whole firm be after this investment (the post-money valuation)?
ABC Co. needs to elect four individuals to board of directors position. ABC has 180,000 shares outstanding and the stock is currently selling for $30 . Individual A wants to serve on the board of directors. How much will it cost A (number of shares times price ) to buy a seat if the company uses straight voting? What if the firm uses cumulative voting? $2,700,030; $1,080,030 $2,640,030; $1,320,030 $2,700,030; $1,350,030 $2,640,030; 1,360,030 $2,710,030; $1,430,030
Give typing answer with explanation and conclusion 1. To incentivize our employees, we are considering issuing them employee equity. The average employee would be issued stock options to purchase 800 shares at our current stock price of $210 per share. We are hopeful that the Smoothie business will catapult us to $230 per share in the future but recognize the risks. If an employee exercises the options at $210 per share, how much would the employee make before taxes?
Baghiben

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS