# Fin 571 week 5 individual assignment dcf and wacc problems

Get Custom Essay on Fin 571 week 5 individual assignment dcf and wacc problems

Let Our Team of Pofessional Writers Take Care of Your Paper.

1. Calculate the future value of 1,535 invested today for 8 years at 6 percent. (5 points)
1. What is the total present value of the following cash stream, discounted at 8 percent? (5 points)

Year                 Amount

1                                              400

2                                              750

3                                              945

4                                              145

5                                              78

3.  If you invested \$2,000 per year into an IRA for 30 years and received 6 percent return each year, what would the account balance be in 30 years? (5 points)

4. A friend gives you a proposition.  If you give him 1,500 dollars today, he will guarantee your receive 12 percent a year for the next 5 years.  How much money will you receive from him at the end of 5 years? (5 points)

5. You want to buy a new Computer Aided Design (CAD) system for your business.  The cost of the system is \$150,000 and you expect to save over \$40,000 per year in reduced labor costs.  Please calculate the net present value of the CAD if your required return is 10 percent and the life of the system is expected to be 5 years. (10 points)

6.  Your company is considering converting its heating system in the main office from coal to heating oil.  The initial cost of removing the coal fired furnace and installing an new oil fired unit is \$60,000.  The life of the analysis is 7 years.  In the past you spent \$25,000 per year on coal.  The new company says you will spend no more than \$15,000 per year on heating oil.  If your required return is 12 percent, should you make this investment?  Please calculate the net present value of this project. (10 points)

7.   You have collected the following information:

a. the yield on your company’s preferred stock 8%

b. the yield on your company’s debt 10%

c. the required return on your company’s common stock and internal equity 12%

d. debt total  \$5,000,000

e. preferred stock current market value \$10,000,000

f. common stock and retained earnings total value \$20,000,000

Please calculate the pre-tax weighted average cost of capital (WACC) for your company.

(10 points)

8.  Your company’s marginal income tax rate is 40%.  Please calculate the post-tax WACC from the information provided in problem 7.  (10 points)

Get 20% Discount on This Paper
Pages (550 words)
Approximate price: -

Try it now!

## Get 20% Discount on This Paper

We'll send you the first draft for approval by at
Total price:
\$0.00

How it works?

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

Proceed with the payment

Choose the payment system that suits you most.

Our Services

Best Quality Essays 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 Best Quality Essays, 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.