Maths Problem

When calculating the cost of internal capital we use dividend modeling When it is to perpetuity the formula is Ke D1 /P g . In this illustration perpetuity starts to be experienced in the fifth socio-economic class . Therefore the formula for arriving at the cost of capital willing be derived as follows :-Po D1 D2 D3 D4 D51 i 1 i 1 i 1 i Ke-g10 .25 1 (1 0 .1 1 (1 .1 )2 1 .21 (1 .08 1 .21 (1 .8 )2 1 .41 (1 .041 Ke 1 Ke 1 ke 1 Ke Ke-0 .0410 .25 1 .1 1 .21 1 .3068 1 .41 1 .4664 (1 Ke (Ke-0 .00410 .25 5 .0268 1 .4664 (1 Ke (Ke-0 .0410 .25 5 .0268 (Ke-0 .04 1 .4664 (1 Ke (1 Ke (Ke-0 .0410 .25 5 .0268Ke - 0 .201 1 .4664 1 .4664KeKe - 0 .04 Ke2 - 0 .04Ke10 .25 6 .4932Ke 1 .265Ke2 0 .

96Ke - 0 .0410 .25 (Ke2 0 .96Ke-04 6 .49Ke 1 .26510 .25Ke2 9 .84Ke - 0 .41 6 .4932Ke 1 .26510 .25Ke2 3 .35Ke - 1 .675 0Using the formula - b (b2-4ac2a3 .35 (3 .35 )2 - 4 x 10 .25 x -1 .6752x10 .25 3 .35 (11 .2225 68 .675 3 .35 1 .974 5 .3220 .5Therefore the cost of internal righteousness of Alpha Tool is 5 .32REFERENCEGapenski l , Eugene Brigham Financial direction : Theory and Practice Dryden Press , 1994...If you want to get a full essay, order it on our website: Orderessay

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