Hello all,
I would really like Wonko.ga to answer, but if anyone can answer this
for me ASAP that would be helpful. thanks

Deere & CO reported EBIT of $586 million in 2002 and had a
depreciation allowance of $106mm. DEERE & CO also had a capital
spending of an equivalent amount in that year. EBIT are expected to
grow 25.00% a year for the next 5 years and then 7.25% a year
thereafter. DEERE & CO has a cost of capital of 10% and its tax rate
is 30.00%. the company has $791mm in debt outstanding with a 5yr
average duration. the beta of the stock is 1.70. the annualized
standard deviation of the company's stock price is 29%, while it is
44% for the company's traded bonds. the correlation between stock ands
bond prices has been .35. the company is also expected to stay ata
debt-to-equity ratio of 40%. the 30-year US treasury bond rate is 5%
and the 5yr bond rate is 4.00%.

a) what is the value of the firm?
b) what is the stock price by using Option Midel if there were 1751mm
shares outstanding in 12/2002
c) what is the market value of the company's debt
d) if the stock price is traded at $18.76, estimated the implied
standard deviation in the firm value

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Clarification of Question by simsim1980-ga on 03 Jan 2005 12:35 PST

Can someone please let me know if the question is not clear.