Round Hammer is comparing two different capital structures: An all-equity plan (Plan l) and a levered plan (Plan Il). Under Plan I, the company would have 205,000 shares of stock outstanding. Under Plan II, there would be 125,000 shares of stock outstanding and $1.73 million in debt outstanding. The interest rate on the debt is 8 percent and there are no taxes. a. Use M&M Proposition I to find the price per share. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the value of the firm under each of the two proposed plans?

Explanation:

A). The computation of price per share is shown below:-

Debt outstanding ÷ (Stock outstanding of Plan 1 - Stock outstanding of

Plan 2)

= $1,730,000 ÷ (205,000 - 125,000)

= $21.63 per share

B a.) Under equity plan the value is

= Debt outstanding × Stock outstanding of Plan 1

= $21.63 × 205,000 shares

= $4,433,125

B b.) under the levered plan the value is

Price per share × Stock outstanding of Plan 2 + Debt outstanding

= $21.63 × 125,000 shares + $1,730,000

= $2,703,125 + $1,730,000

= $4,433,125

11th

Physics

Motion in a Plane

Projectile Motion

A tennis ball is hit with a...

PHYSICS

A tennis ball is hit with a vertical speed of 10m/s upwards and a horizontal speed of 30m/s. How far will the ball travel horizontally before landing?

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ANSWER

Given,

v

0y

=10m/s

v

0x

=30m/s

g=10m/s

2

In projectile motion, for solving the total distance traveled by the ball horizontally, have to calculate the total time to cover going up and landing down by the given equation,

y=v

0y

t+

2

1

gt

2

+y

0

at the point where it lands, y=0

0=10t+

2

1

(−10)t

2

0=t(10−5t)

t=0,2sec

The total horizontal distance covered by the tennis ball is given by

x=v

0x

t

x=30×2

x=60m

The correct option is D.

Explanation:

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