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NEW QUESTION: 1
Rollins Corporation is constructing its MCC schedule. Its target capital structure is 20 percent debt, 20 percent preferred stock, and 60 percent common equity. Its bonds have a 12 percent coupon, paid semiannually, a current maturity of 20 years, and sell for $1,000. The firm could sell, at par, $100 preferred stock, which pays a 12 percent annual dividend, but flotation costs of 5 percent would be incurred. Rollins' beta is 1.2, the risk-free rate is 10 percent, and the market risk premium is 5 percent. Rollins is a constant growth firm, which just paid a dividend of $2.00, sells for $27.00 per share, and has a growth rate of 8 percent. The firm's policy is to use a risk premium of 4 percentage points when using the bond-yield-plus- risk- premium method to find k(s). The firm's net income is expected to be $1 million, and its dividend payout ratio is 40 percent. Flotation costs on new common stock total 10 percent, and the firm's marginal tax rate is 40 percent. What is Rollins' cost of retained earnings using the bond-yield-plus-risk-premium approach?
A. 16.0%
B. 13.6%
C. 16.6%
D. 14.1%
E. 16.9%
Answer: A
Explanation:
Explanation/Reference:
Explanation:
Cost of retained earnings (Bond yield plus risk premium approach): k(s) = 12.0% + 4.0% = 16.0%.
NEW QUESTION: 2
In the process of troubleshooting traffic issues across a VPN tunnel, you notice on the output of fw monitor -e host(172.21.1.10), accept; that packets are going through the inbound chain (i > I) and then disappearing after the outbound chain (o > __), while you were expecting to see the packet leave on O.
What could be causing this issue?
A. It's not showing up on the fw monitor because it is exiting the wrong interface
B. When packets are destined to leave through a VPN tunnel, it is encrypted and encapsulated in an ESP packet, and thus will not show up on a fw monitor.
C. The packet is getting silently dropped because there is no route for the packet.
D. The gateway never completed the IKE and IPSec key exchange, and the tunnel does not exist yet.
Answer: B
NEW QUESTION: 3
If an application is storing hourly log files from thousands of instances from a high traffic web site, which naming scheme would give optimal performance on S3?
A. Sequential
B. instanceID_log-YYYY-MM-DD-HH
C. instanceID_log-HH-DD-MM-YYYY
D. YYYY-MM-DD-HH-log_instanceID
E. HH-DD-MM-YYYY-log_instanceID
Answer: E