(Solved): 42, 43 answer both for immediate upvote Howton \& Howton Worldwide (HHW) is planning its operation ...

Howton \& Howton Worldwide (HHW) is planning its operations for the coming year, and the CEO wants you to forecast the firm's additional funds needed AFN). Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 10\% that was ased in the past to $45\%$, which the firm's investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the coming year change if HHW increased the payout from $10\%$ to the new and higher level? All dollars are in millions. Do not round intermediate calculations. a. 537,0 million b. 126.4 million c $\$23.5$ million d. 516.8 milion e. 534.1 million Simpson Inc, is considering a vertical merger with The Lachey Company. Simpson currently has a required return of $9\%$, while Lachey's required return is $16\%$ The market risk premium is $4,90\%6$ and the risk-free rate is $5\%$. Assume the market is in equilibrium. If Simpson is going to make up $69\%$ of the new firm (and achey will comprise the remaining 3196), what will be the beta of the new merged firm? There will be no additional infusion of debt in the merger. Do not ound your intermedinte calculations, a. 2.24 t. 0.82 c. 2,28 d. 0.98 e. 1.26 Howton \& Howton Worldwide (HHW) is planning its operations for the coming year, and the CEO wants you to forecast the firm's additional funds needed AFN). Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 10 ). that was ised in the past to $45\%$, which the firm's investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the coming ear change if HHW increased the payout from $10\%$ to the new and higher level? All dollars are in millions. Do not round intermediate calculations. a. 537,0 million b. 526.4 million c. $\$23.5$ miltion d. $\$16.8$ million e, $\$34,1$ million Simpson Inc is considering a vertical merger with The iachey Company. Simpson currently has a required return of $9\%$, while Iachey's required return is i6\%. The market risk premium is $4.90\%$ and the risk-free rate is $5\%$. Assume the market is in equilibrium. If Simpson is going to make up b9\% of the new firm (and Lachey will comprise the remnining 3196), what will be the beta of the new merged firm? There will be no additional infusion of debt in the merger. Do not. rotind your intermediate calculations. a. 224 b. 0.82 c. 2.28 d. 0.98 e. 1.26