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NEW QUESTION: 1
Rollins Corporation is constructing its MCC (marginal cost of capital) schedule. Its target capital structure is
20 percent debt, 20 percent preferred stock, and 60 percent common equity. Its bonds have a 12percent 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) (component cost of retained earnings). 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 CAPM (Capital Asset Pricing Model) approach?
A. 14.1%
B. 16.0%
C. 16.6%
D. 16.9%
E. 13.6%
Answer: B
Explanation:
Explanation/Reference:
Explanation:
Cost of retained earnings (CAPM approach): k(s) (component cost of retained earnings) = 10% + 1.2(5%)
= 16.0%.
NEW QUESTION: 2
Which of the following terms refers to an anti-virus software file that is updated from time to time to protect a computer from new viruses?
A. Modules
B. Service pack
C. Hotfix
D. Definition
Answer: D
Explanation:
Definition is an anti-virus software file that should be updated at regular intervals to protect a computer from new viruses. This file is also known as virus definition file. The virus definition file contains information about the latest viruses, which helps identify new viruses and protect computers from them. Answer option D is incorrect. Hotfix is a collection of files used by Microsoft for software updates that are released between major service pack releases. A hotfix is about a problem, occurring under specific circumstances, which cannot wait to be fixed till the next service pack release. Hotfixes are generally related to security problems. Hence, it is essential to fix these problems as soon as possible. Answer option C is incorrect. A service pack is a collection of Fixes and Patches in a single product. A service pack can be used to handle a large number of viruses and bugs or to update an operating system with advanced and better capabilities. A service pack usually contains a number of file replacements. Answer option B is incorrect. This term does not refer to any anti-virus software file. Reference. "http.//en.wikipedia.org/wiki/Computer_virus"
NEW QUESTION: 3
Which statement is TRUE regarding the order by which Workflow Rules and actions are executed?
Choose 3 Answers
A. Unlike assignment rules, there is no set order in which workflow rules may be triggered
B. A user cannot use the system log to track and troubleshoot the execution of workflow triggers.
C. Multiple workflow rules are executed upon save resulting in any combination of different actions
D. Workflow actions execute i n the following order: field update, task, emails, outbound messaging.
Answer: A,C,D
NEW QUESTION: 4
A network administrator is unable to install programs on a workstation. Which of the following is MOST likely the reason the administrator is not able to install applications?
A. The username is not part of the local administrator group.
B. The workstation is victim of a denial of service attack.
C. The administrator has not applied appropriate security patches.
D. The username is not authenticating on the network.
Answer: A
Explanation:
Section: Security
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