ACTSC 372 Corporate Finance 2
Assignment 2 Due Date Wednesday June 30th at 10:00 am in the drop boxes
Question 1: A Company has a target capital structure of 55 percent common stock and 45
percent debt. If the cost of equity is 16% and the cost of debt is

ACTSC 372 Assignment #3
Due July 28th at noon in the drop boxes
1. Waterloo Power Inc (WPI), an all equity firm, is planning to build a new power
generation plant. Below is some financial data pertaining to WPI.
The new plant has the same risks as the co

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ACTSC 372 Assignment #4
Due Monday April 8th at 10am in the drop boxes
I. In this question, we will explore the irrelevance of dividend policy. Suppose XYZ
Inc currently has 1 million shares outstanding, and XYZ expects to make $1 million
pe

ACTSC 372 - Corporate Finance 2
Assignment 1 Due Thursday January 31 3:30 pm
in the drop boxes outside MC 4066
Question 1: Assume we have for two securities, A and B , A = 5%, B =
8%, A = 10%, B = 15%, AB = 40%.
(a) Find the minimum variance portfolio. Wh

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ACTSC 372 - Corporate Finance 2
Assignment 1 Due Thursday January 31 3:30 pm
in the drop boxes outside MC 4066
Question 1: Assume we have for two securities, A and B, ,uA = 5%, MB =
8%,0A = 10%,03 = 15%,pAB =
(a) Find the minimum variance

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ACTSC 372 Corporate Finance 2
Assignment #2 Due Thuesday February 28th at noon
In the DROP BOXES
Question 1: Assume we believe securities follow a 2 factor APT model, i.e. assume for an asset
X we have
RX = 5% + 0.5001 Ej 1.5(F2 E') + e

ACTSC 372 Assignment #4
Due Monday April 8th at 10am in the drop boxes
1. In this question, we will explore the irrelevance of dividend policy. Suppose XYZ
Inc currently has 1 million shares outstanding, and XYZ expects to make $1 million
per year in perp

ACTSC 372 Assignment #3
Due March 14th at noon in the drop boxes
Question 1: Prove that = 0 + (0 )(1 ). Where is the levered equity beta, 0
is the unlevered equity beta, is the beta of debt. Show that when debt is riskless, we get the
(1 )
expression = 1

ACTSC 372 Corporate Finance 2
Assignment #2 Due Thuesday February 28th at noon
In the DROP BOXES
Question 1: Assume we believe securities follow a 2 factor APT model, i.e. assume for an asset
we have
= 5% + 0.5(1 1.5(2 2 ) +
1 )
Where represents the fa

Assignment 4 ACTSC 372
Due July 28th at noon in the drop boxes
1) Discuss two reasons why people trade too much?
2) What is the impact to a persons portfolio when they trade too much?
3) Why would a 90 year old person likely not want to have a portfolio t