AFF 310 Tutorial Problems Week of October 20th - Financing
Problem One: ABC Inc is currently priced at $30 per share. There are currently 20 million shares
outstanding. The company wishes to raise $150 million. The company has been told by its underwriter
AFF 310 Tutorial Week: More Capital Structure Problems.
Problem One: You have an all equity firm. The firm will generate EBIT of $150,000 per year in perpetuity.
The unlevered required rate of return is 15%. The firm can borrow the required rate of return
AFF310 Fall 2014
Tutorial Problems for First Tutorial
Problem One: ABC Inc. has 100,000 common shares outstanding. The price per share is $20. The
company common stock just paid a dividend of $2 per share. Dividends are paid annually. The dividend
Tutorial Problems Week of October 27th, 2014, Dividends
A company will be operating for another two years. The company has 1,000,000
shares outstanding. The company will pay a dividend of $25 per share 1 year from today and a final