Market value will be 60 millions during the year company


Market value will be 60 millions. During the year company will raise and invest 20 million in new projects. The firm presents value capital structure described below. No short -term debt. Debt: 30,000,000 Common equity: 30,000,000 and Total equity: 60,000,000. New bonds have 10% coupon rate, and they will be sold par. Common stock currently selling at $30 a share. Stockholders required rate of return is 12%, consider dividend yield of 4% and expected growth of 8%. ( the next expected dividend is 1.20, so $1.20/$30=4%). The marginal corporate tax rate is 35%.

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Financial Management: Market value will be 60 millions during the year company
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