2. (a) Your company is required to pay into a sinking fund each year in matures in 10 years. The amount of the obligation is Tshs 100,000 deposits. How much must your company deposit each year in orde (b)Your uncle lends you Tshs 10,000/- today with the promise that three years. What rate of interest is he charging? (a)What kind of cash flows do investors expect from their investme (b)What role does bond indenture plays in a bond investment? (c)Assume that a company listed on the Sunrise Stock Exchange 100 shillings per share next year, shillings 200 in the year that follo year. After that, dividends are expected to grow at constant 5% pe 10%, what price should investors pay for such shares today? Suppose a firm is considering a project that would require an initia expected to generate shs 4.5 million each year for the next 4 year and costs increases at the same rate and that the required rate of 14%. The firm also practices a policy whereby cash flows are stat inflation rate is expected to be 5%. (a)Outline two ways in which the effects that inflation has on the
2. (a) Your company is required to pay into a sinking fund each year in matures in 10 years. The amount of the obligation is Tshs 100,000 deposits. How much must your company deposit each year in orde (b)Your uncle lends you Tshs 10,000/- today with the promise that three years. What rate of interest is he charging? (a)What kind of cash flows do investors expect from their investme (b)What role does bond indenture plays in a bond investment? (c)Assume that a company listed on the Sunrise Stock Exchange 100 shillings per share next year, shillings 200 in the year that follo year. After that, dividends are expected to grow at constant 5% pe 10%, what price should investors pay for such shares today? Suppose a firm is considering a project that would require an initia expected to generate shs 4.5 million each year for the next 4 year and costs increases at the same rate and that the required rate of 14%. The firm also practices a policy whereby cash flows are stat inflation rate is expected to be 5%. (a)Outline two ways in which the effects that inflation has on the
Chapter19: Lease And Intermediate-term Financing
Section: Chapter Questions
Problem 19P
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