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NEW QUESTION: 1
Flood Motors is an all-equity firm with 200,000 shares outstanding. The company's EBIT is $2,000,000 and is expected to remain constant over time. The company pays out all of its earnings each year, so its earnings per share equals its dividends per share. The company's tax rate is 40 percent. The company is considering issuing $2 million worth of bonds (at par) and using the proceeds for a stock repurchase. If issued, the bonds would have an estimated yield to maturity of 10 percent. The risk-free rate in the economy is 6.6 percent, and the market risk premium is 6 percent. The company's beta is currently 0.9, but its investment banker's estimate that the company's beta would rise to 1.1 if they proceed with the recapitalization. Assume that the shares are repurchased at a price equal to the stock market price prior to the recapitalization. What would be the company's stock price following the recapitalization?
A. $51.14
B. $76.03
C. $68.97
D. $53.85
E. $56.02
Answer: A
Explanation:
Explanation/Reference:
Explanation:
First, find the company's current cost of capital, dividends per share, and stock price: k = 0.066 + (0.06)0.9
= 12%. To find the stock price, you still need the dividends per share or DPS = ($2,000,000 (1 -
0.4))/200,000 = $6.00. Thus, the stock price is Po = $6.00/0.12 = $50.00. Thus, by issuing $2,000,000 in new debt the company can repurchase $2,000,000/$50.00 = 40,000 shares.
Now after recapitalization, the new cost of capital, DPS, and stock price can be found: k = 0.066 + (0.06)
1.1 = 13.20%. DPS for the remaining (200,000 - 40,000) = 160,000 shares are thus [($2,000,000 - ($2,000,000 x 0.10))(1 - 0.4)]/160,000 = $6.75. And, finally, Po = $6.75/0.132 = $51.14.
NEW QUESTION: 2
You have a 4-node cluster and want to ensure that a new NAS LIF can fail over to any node.
In this scenario, which two actions are required to configure the LIF? (Choose two.)
A. Configure the failover policy to system-defined.
B. Configure the failover policy to broadcast-domain-wide.
C. Add ports from all nodes to the LIF's broadcast domain.
D. Add ports from all nodes to the LIF's home port list.
Answer: A,C
NEW QUESTION: 3
As part of archiving the historical data, you want to transfer data from one database to another database, which is on another server. All tablespaces in the source database are read/write and online. The source and target databases use the same compatibility level and character sets. View the Exhibit and examine the features in the source and target database.
Which of the following steps are required to transport a tablespace from the database to the target database:
1
2
3
. Make the tablespace read-only at the source database.
. Export metadata from the source database.
. Convert data filed by using Recovery Manager (RMAN).
4
5
6
. Transfer the dump file and data filed to the target machine.
. Import metadata at the target database.
. Make the tablespace read/write at the target database.
Exhibit:
A. 1, 2, 4, 5 and 6
B. 2, 4, and 5
C. All the steps
D. 2, 3, 4 and 5
Answer: A
Explanation:
Explanation/Reference:
Explanation:
Generate a Transportable Tablespace Set
read_only--expdp--4-import-read_wrtie
1, 2, 4, 5, 6 (optional)
If both platforms have the same endianness, no conversion is necessary. Otherwise you must do a conversion of the tablespace set either at the source or destination database.
Transport the dump file to the directory pointed to by the DATA_PUMP_DIR directory object, or to any other directory of your choosing.
Run the following query to determine the location of DATA_PUMP_DIR:
SELECT * FROM DBA_DIRECTORIES WHERE DIRECTORY_NAME = 'DATA_PUMP_DIR';
Transport the data files to the location of the existing data files of the destination database.
On the UNIX and Linux platforms, this location is typically /u01/app/oracle/oradata/SID/ or +DISKGROUP/ SID/ datafile/.
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