HOMEWORK 6
1) The market value of Charter Cruise Company's equity is 10 m illion USD, and t he market value of its r isk-free debt is 6 m illion USD. If the required rate of return on the equity is 0.15 and that on the debt is 0.08, calculate the company'
1 )If t he corporate tax rate is 35%, what is the maximum effective tax rate on dividends received by another corporation?
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10.5%
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30%
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20%
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11.8%
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10.3%
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35%
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21.9%
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0%
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HOMEWORK 5
1) I n the case of a portfolio of N-stocks, the formula for portfolio variance contains how many u nique covariance terms?
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N
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N /2
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N (N-1)
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N ^2
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N (N-1)/2
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N -1
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N ^2-N/2
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