Chapter 14
Problems 1-26
Input boxes in tan
Output boxes in yellow
Given data in blue
Calculations in red
Answers in green
Chapter 14
Question 1
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Chapter 14
Question 2
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Chapter 14
Question 3
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Chapter 14
Question 4
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Arithmetic average:
Geometric average:
Chapter 14
Question 5
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Chapter 14
Question 6
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Chapter 14
Question 7
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Second issue
Chapter 14
Question 9
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a. WACC 9.04%
b. Since interest is tax deductible and dividends
Chapter 14
Question 10
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Chapter 14
Question 11
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Chapter 14
Question 12
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The market value weights are more relevant
Shares outstanding 8,000,000
Bond I
Book value 85,000,000$
Bond II
Book value 50,000,000$
Chapter 14
Question 13
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Bond I
Bond II