Contemporary Engineering Economics (6th Edition)
6th Edition
ISBN: 9780134105598
Author: Chan S. Park
Publisher: PEARSON
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Question
Chapter 2, Problem 10P
To determine
Calculate the return on common equity.
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Apple Inc.CONSOLIDATED BALANCE SHEETS(In millions, except number of shares which are reflected in thousands and par value)September 28, 2019 September 29, 2018ASSETSCurrent assetsCash and cash equivalents $ 48,844 $ 25,913Marketable securities 51,713 40,388Accounts receivable, net 22,926 23,186Inventories 4,106 3,956Vendor non-trade receivables 22,878 25,809Other current assets 12,352 12,087Total current assets 162,819 131,339Non-current assetsMarketable securities 105,341 170,799Property, plant and equipment, net 37,378 41,304Other non-current assets 32,978 22,283Total non-current assets 175,697 234,386Total assets $ 338,516 $ 365,725LIABILITIES AND SHAREHOLDERS’ EQUITYCurrent liabilitiesAccounts payable $ 46,236 $ 55,888Other current liabilities 37,720 33,327Deferred revenue 5,522 5,966Commercial paper 5,980 11,964Term debt 10,260 8,784Total current liabilities 105,718 115,929Non-current liabilitiesTerm debt 91,807 93,735Other non-current liabilities 50,503 48,914Total non-current…
Problem
Sebastian Vincent and his wife, Elyse have they decided to purchase
$2500 worth of utility stocks starting 2 years from now. The married
couple is expecting their income to increase so they have decided to
increase their purchases by $250 per year for the next 10 years. What
would be the present worth, future worth, and annual worth of their
utility stocks if they yield a uniform dividend of 10% throughout the
investment period and the price/share remains constant?
(Use equation Tool for solutions and provide cash flow diagram)
4. You have developed an innovative new project that is estimated to produce an annual revenue
stream (money in) of $15,000 per year for the next 10 years. Your current corporate cost of
Money is 4%. However, in year 5, your CFO projects that rate will rise to 6% for the remaining
five years of the project's lifespan. What is the NPV of this money in cashflow today? (we are
ignoring any money out costs)
Chapter 2 Solutions
Contemporary Engineering Economics (6th Edition)
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