Fin515 homework 4 | Business & Finance homework help

Complete the following graded homework assignment in a Word document named FIN515_Homework4_yourname.
Show the details of your calculation and work in your answer to the problems.

Problems (pp. 303-305)

Don't use plagiarized sources. Get Your Custom Essay on
Fin515 homework 4 | Business & Finance homework help
Just from $13/Page
Order Essay

9-4 Dividend Yield and Cost of Equity Capital


9-5 No Growth Company
9-6 Value of Operations of Constant Growth


9-7 Expected Growth Rate of Constant Growth Company


9-12 Non Constant Dividend


9-1 Future Value of a Company

9-19 Enterprise Value

Problems (pp. 427–429)

12-1 Equity Cost of Capital


12-3 Higher Equity Cost of Capital


12-26 Equity Cost of Capital, Debt Cost of Capital and WACC

Course Text:
Corporate Finance
3rd Edition
by Jonathan Berk & Peter DeMarzo
© 2014 Pearson Education

Problems pp. 303 – 305
Question 1. Assume Evco, Inc., has a current price of $50 and will pay a $2 dividend in one
year, and its equity cost of capital is 15%. What price must you expect it to sell for right after
paying the dividend in one year in order to justify its current price?
Question 4. Krell Industries has a share price of $22 today. If Krell is expected to pay a dividend
of $0.88 this year, and its stock price is expected to grow to $23.54 at the end of the year, what is
Krell’s dividend yield and equity cost of capital?
Question 5. NoGrowth Corporation currently pays a dividend of $2 per year, and it will
continue to pay this dividend forever. What is the price per share if its equity cost of capital is
15% per year?
Question 6. Summit Systems will pay a dividend of $1.50 this year. If you expect Summit’s
dividend to grow by 6% per year, what is its price per share if its equity cost of capital is 11%?

Question 7. Dorpac Corporation has a dividend yield of 1.5%. Dorpac’s equity cost of capital is
8%, and its dividends are expected to grow at a constant rate.
a. What is the expected growth rate of Dorpac’s dividends?
b. What is the expected growth rate of Dorpac’s share price?
Question 12. Procter & Gamble will pay an annual dividend of $0.65 one year from now.
Analysts expect this dividend to grow at 12% per year thereafter until the fifth year. After then,
growth will level off at 2% per year. According to the dividend-discount model, what is the value
of a share of Procter & Gamble stock if the firm’s equity cost of capital is 8%?
Question 19. Heavy Metal Corporation is expected to generate the following free cash flows
over the next five years:


FCF ($ millions) 53 68 78 75 82
After then, the free cash flows are expected to grow at the industry average of 4% per year.
Using the discounted free cash flow model and a weighted average cost of capital of 14%:
• a. Estimate the enterprise value of Heavy Metal.
• b. If Heavy Metal has no excess cash, debt of $300 million, and 40 million shares
outstanding, estimate its share price.
Problems pp. 427 – 429
Question 1. Suppose Pepsico’s stock has a beta of 0.57. If the risk-free rate is 3% and the
expected return of the market portfolio is 8%, what is Pepsico’s equity cost of capital?
Question 3. Aluminum maker Alcoa has a beta of about 2.0, whereas Hormel Foods has a beta of
0.45. If the expected excess return of the marker portfolio is 5%, which of these firms has a
higher equity cost of capital, and how much higher is it?
Question 26. Unida Systems has 40 million shares outstanding trading for $10 per share. In
addition, Unida has $100 million in outstanding debt. Suppose Unida’s equity cost of capital is
15%, its debt cost of capital is 8%, and the corporate tax rate is 40%.
a. What is Unida’s unlevered cost of capital?
b. What is Unida’s after-tax debt cost of capital?
c. What is Unida’s weighted average cost of capital?

Grab 16% Discount On This Paper
Pages (550 words)
Approximate price: -

Why Choose Us

Quality Papers

We value our clients. For this reason, we ensure that each paper is written carefully as per the instructions provided by the client. Our editing team also checks all the papers to ensure that they have been completed as per the expectations.

Professional Academic Writers

Over the years, MyEssay.Help has managed to secure the most qualified, reliable and experienced team of writers. The company has also ensured continued training and development of the team members to ensure that it keep up with the rising Academic Trends.

Affordable Prices

Our prices are fairly priced in such a way that ensures affordability. Additionally, you can get a free price quotation by clicking on the "Place Order" button.

On-Time delivery

We pay strict attention on deadlines. For this reason, we ensure that all papers are submitted earlier, even before the deadline indicated by the customer. For this reason, the client can go through the work and review everything.

100% Originality

At, all papers are plagiarism-free as they are written from scratch. We have taken strict measures to ensure that there is no similarity on all papers and that citations are included as per the standards set.

Customer Support 24/7

Our support team is readily available to provide any guidance/help on our platform at any time of the day/night. Feel free to contact us via the Chat window or support email:

Try it now!

Grab 16% Discount On This Paper

We'll send you the first draft for approval by at
Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services has stood as the world’s leading custom essay writing services providers. Once you enter all the details in the order form under the place order button, the rest is up to us.


Essay Writing Services

At, we prioritize on all aspects that bring about a good grade such as impeccable grammar, proper structure, zero-plagiarism and conformance to guidelines. Our experienced team of writers will help you completed your essays and other assignments.


Admission and Business Papers

Be assured that you’ll definitely get accepted to the Master’s level program at any university once you enter all the details in the order form. We won’t leave you here; we will also help you secure a good position in your aspired workplace by creating an outstanding resume or portfolio once you place an order.


Editing and Proofreading

Our skilled editing and writing team will help you restructure you paper, paraphrase, correct grammar and replace plagiarized sections on your paper just on time. The service is geared toward eliminating any mistakes and rather enhancing better quality.


Technical papers

We have writers in almost all fields including the most technical fields. You don’t have to worry about the complexity of your paper. Simply enter as much details as possible in the place order section.

                                                                                     Place Order