What is the firms equity multiplier


(Question 1) What is the net present value of a project with the following cash flows if the required rate of return is 15 percent?

Year    Cash Flow
0        -$42,398
1          13,407
2          21,219
3          17,800

(Question 2) A firm has a debt-to-equity ratio of 0.5. What is the firm's equity multiplier?

(Question 3) Microsoft's beta is 1. The risk free rate of return is 2%. If the expected return on the market is 12 percent, then the expected return on Microsoft is:

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Finance Basics: What is the firms equity multiplier
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