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1) Ford Motor Company is discussing new ways to recapitalize the firm and raise additional capital....

1) Ford Motor Company is discussing new ways to recapitalize the firm and raise additional capital. Its current capital structure has a 20?% weight in? equity, 10?% in preferred? stock, and 70?% in debt. The cost of equity capital is 14?%, the cost of preferred stock is 10?%, and the pretax cost of debt is 9?%. What is the weighted average cost of capital for Ford if its marginal tax rate is 40?%?

2)Suppose you invested $56 in the Ishares Dividend Stock Fund? (DVY) a month ago. It paid a dividend of $0.74 today and then you sold it for $65. What was your return on the? investment?

3)A portfolio has three stocks long dash— 140 shares of Yahoo? (YHOO), 230 shares of General Motors? (GM), and 50 shares of Standard and? Poor's Index Fund? (SPY). If the price of YHOO is? $20, the price of GM is? $20, and the price of SPY is? $130, calculate the portfolio weight of YHOO and GM.

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