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a. critically discuss five benefits of finincial management to a small computer firm.
b. Never say die Ltd has been growing at a phenomenal rate of 20% per year because of its rapid extension and explosive sales. analysts believe that this growth rate will last for three years and then drop to 5% per annum. if the growth rate then remains 5% indefinitely, what is the value of Never say die Ltd shares? if the dividend paid last year per share was 12 ghana cedis and the cost of capital is 15%.
c. pure juice Ltd sold bonds to the public five years ago to finance its operation.the bond was recntly quoted at 89% of face value. the bond has a total face value of 8.5million ghana cedis and its currently priced to yield 9%. pure juice Ltd shares currentlysell for 14ghana cedis per share. fifty-three (53%) of pure juice Ltd 3.2 million shares are outstanding. to raise additional capital, pure juice Ltd issued 500
(I) calculate pure juice Ltd Weighted Average Cost of Capital.
(ii) assume that no information is provided on risk-free rate, beta and expected market returns. instead, you are told that pure juice Ltd paid a dividend of 4 ghana cedis per share last year and will grow steadily at 6% per year into the future. the stock currently sells for 60ghana cedis a share. calculate pure juice Ltd's Weighted Average Cost of Capital.
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