Suppose a firm is considering a $20 million project in Seattle that will last 4 years. Assume that cash revenues less cash expenses are $8.5 million for each of the 4 years. Additionally, assume that the corporate tax rate is 35 percent. The risk-free rate is 6%, and the unlevered cost of equity is 15%. Assume that the firm depreciates the initial investment straight-line to zero over the life of the project.

Calculate the All-equity value of the firm. You are doing this with a financial calculator and you must show and explain your steps. You must explain your choice(s) of discount rates. It is best if your equation is a sum of each part that you show the number for each piece of the PV, for maximum partial credit.

Corporations with suppliers, vendors, and customers all over the globe are referred to as : a) global corporations b) international corporations c) multinational corporations d) multicultural corporations

Profits from using currency options and futures.on july 2, the two-month futures rate of the mexican peso contained a 2 percent discount (unannualized). there was a call option on pesos with an exercise price that was equal to the spot rate. there was also a put option on pesos with an exercise price equal to the spot rate. the premium on each of these options was 3 percent of the spot rate at that time. on september 2, the option expired. go to the oanda.com website (or any site that has foreign exchange rate quotations) and determine the direct quote of the mexican peso. you exercised the option on this date if it was feasible to do so. a. what was your net profit per unit if you had purchased the call option? b. what was your net profit per unit if you had purchased the put option? c. what was your net profit per unit if you had purchased a futures contract on july 2 that had a settlement date of september 2? d. what was your net profit per unit if you sold a futures contract on july 2 that had a settlement date of september 2

Brandt enterprises is considering a new project that has a cost of $1,000,000, and the cfo set up the following simple decision tree to show its three most likely scenarios. the firm could arrange with its work force and suppliers to cease operations at the end of year 1 should it choose to do so, but to obtain this abandonment option, it would have to make a payment to those parties. how much is the option to abandon worth to the firm?