Business, 30.05.2020 23:00 HolaConcheeDaBrycee

Roybus, Inc., a manufacturer of flash memory, just reported that its main production facility in Taiwan was destroyed in a fire. Although the plant was fully insured, the loss of production will decrease Roybus's free cash flow by $ 185 million at the end of this year and by $ 55 million at the end of next year. a. If Roybus has 37 million shares outstanding and a weighted average cost of capital of 13.1 %, what change in Roybus's stock price would you expect upon this announcement? (Assume that the value of Roybus's debt is not affected by the event.) b. Would you expect to be able to sell Roybus stock on hearing this announcement and make a profit? Explain. a. If Roybus has 37 million shares outstanding and a weighted average cost of capital of 13.1 %, what change in Roybus's stock price would you expect upon this announcement? (Assume that the value of Roybus's debt is not affected by the event.) The change in price per share would be $ nothing. (Round to the nearest cent.) b. Would you expect to be able to short sell Roybus stock on hearing this announcement and make a profit? (Select the best choice below.)

Answers: 2

Show answers

Another question on Business

Business, 21.06.2019 21:30

Gary becker's controversial the economics of discrimination concludes that price discrimination has no effect on final profits. price discrimination benefits monopolies. labor discrimination in hiring results in more efficient allocations of production. discrimination in hiring practices has no effect on final profits. labor discrimination harms firms that practice it due to increased labor costs. price discrimination harms monopolies, which refutes over two centuries of economic theory.

Answers: 3

Answer

Business, 22.06.2019 05:30

The struter partnership has total partners’ equity of $510,000, which is made up of main, capital, $400,000, and frist, capital, $110,000. the partners share net income and loss in a ratio of 80% to main and 20% to frist. on november 1, adison is admitted to the partnership and given a 15% interest in equity and a 15% share in any income and loss. prepare journal entries to record the admission of adison for a 15% interest in the equity and a 15% share in any income and loss under the following independent assumptions. (1) record the admission of adison with an investment of $90,000 for a 15% interest in the equity and a 15% share in any income and loss. (2) record the admission of adison with an investment of $120,000 for a 15% interest in the equity and a 15% share in any income and loss. (3) record the admission of adison with an investment of $80,000 for a 15% interest in the equity and a 15% share in any income and loss.

Answers: 1

Answer

Business, 22.06.2019 22:10

Afirm plans to begin production of a new small appliance. the manager must decide whether to purchase the motors for the appliance from a vendor at $10 each or to produce them in-house. either of two processes could be used for in-house production; process a would have an annual fixed cost of $200,000 and a variable cost of $7 per unit, and process b would have an annual fixed cost of $175,000 and a variable cost of $8 per unit. determine the range of annual volume for which each of the alternatives would be best. (round your first answer to the nearest whole number. include the indifference value itself in this answer.)

Answers: 2

Answer

Business, 23.06.2019 00:30

Braden’s ice cream shop is losing business. he knows that customers are no longer choosing his product because a competing product has become less expensive, yet he has refused to lower his prices. what has happened to braden’s business?

Answers: 1

Answer

You know the right answer?

Roybus, Inc., a manufacturer of flash memory, just reported that its main production facility in Tai...

Questions