Your boss believes the company’s power plant is producing too much air pollution on a typical island. Your boss gives you three choices for dealing with this problem because he/she does not want to deal with it:

1. You can pay a pollution tax (Carbon Offsets) one time of $13,000,000 immediately.
2. You can close the plant and install a power cable from the mainland to the Island. That will cost you $1,000,000 at the end of this year, $3,000,000 at the end of next year and then $750,000 forever for maintenance.
3. You can retrofit the plant with scrubbers to reduce the emissions to make the plant green. That will cost $7.5m at the end of this year and $100,000 for 50-years for maintenance.

Assume that the cost of generating power on the mainland is approximately the same as the cost of generating power at the Island’s plant. Assume, this comes as a surprise to you and you, have not saved any money in reserves, and you need to raise capital.  Additional information is that market has a 12 percent market risk premium on the power plant with the risk-free rate being 5 percent with a company tax rate of 35 percent.

Current total raised capital at the power plant:  (This will help you calculate the WACC)

• Debt –  7,000 outstanding bonds, at 7.5% coupon and 20 years to maturity. These bonds pay interest semiannually and quoted a price of 108 percent of par.
• Common Stock -180,000 shares outstanding, selling for $50 per share: Beta .90.
• Preferred Stock – 8,000 shares of 5.5 percent preferred stock outstanding, currently selling for $95.00 per share.

Please answer in essay format and provide your Excel document showing all your calculation in appendixes choose the best option for Island. Support your answer with your calculations. Also, to calculations use specified resources, other appropriate scholarly resources, including older articles.

Length: However long you need to answer the question (Paragraph per option is normal).

Your paper should demonstrate thoughtful consideration of the ideas and concepts presented in the course and provide new thoughts and insights relating directly to this topic. Your response should reflect scholarly writing and current APA standards. Be sure to adhere to University’s Academic Integrity Policy.

Upload your assignment using the Upload Assignment button below.

Grading Guideline –

• The introduction should state the answer and establish the topic and a clear thesis statement.
• The conclusion summarizes the main points and leaves the reader with a strong comprehension of the paper’s significance and the author’s understanding of the correct financial decision.
• All research is correctly credited, using correct APA format.
• Grammatically correct – No spelling, grammar, or mechanics errors.

	RUBRIC
Criteria	Exemplary	Accomplished	Developing	Beginning
Financial Management  Weight 14.00%	100 % Demonstrates mastery and accuracy of most of the concepts, terms, and theories of finance.	90 % Demonstrates mastery and accuracy of some of the concepts, terms, and theories of finance.	75 % Demonstrates moderate understanding of a few of the concepts, terms and theories, but lacks a mastery of the majority of finance.	50 % Demonstrates basic understanding of the concepts, terms, and theories, but lacks any mastery at all of finance.
Time Value of Money  Weight 14.00%	100 % Demonstrates mastery of calculating and applying the concept of the time value of money to make financial management decisions valuing securities, including debt and equity instruments.	90 % Demonstrates mastery of some of the concepts of calculating and applying the concept of the time value of money to make financial management decisions valuing securities, including debt and equity instruments.	75 % Demonstrates minimal understanding of the concepts of calculating and applying the concept of the time value of money to make financial management decisions valuing securities, including debt and equity instruments.	50 % Demonstrates basic understanding of the concepts, and lacks mastery of calculating and applying the concept of the time value of money to make financial management decisions valuing securities, including debt and equity instruments.
Measure of Risk  Weight 14.00%	100 % Demonstrates mastery of calculating and applying the principles of capital investment decisions to measure risk and return decisions.	90 % Demonstrates mastery of most of the concepts regarding calculating and applying the principles of capital investment decisions to measure risk and return decisions.	75 % Demonstrates minimal mastery of calculating and applying the principles of capital investment decisions to measure risk and return decisions.	50 % Demonstrates basic understanding of the concepts, but lacks mastery of calculating and applying the principles of capital investment decisions to measure risk and return decisions.
Capital Structure  Weight 15.00%	100 % Recognizes & expertly understands capital structure in raising funds so that there is a balance maintained between debt and equity capital.	90 % Is able to recognize & understand most of the concepts of capital structure in raising funds so that there is a balance maintained between debt and equity capital.	75 % Is able to recognize & understand moderately the capital structure in raising funds so that there is a balance maintained between debt and equity capital.	50 % Is able to recognize & understand minimally the capital structure in raising funds so that there is a balance maintained between debt and equity capital.
Financial Ratios  Weight 14.00%	100 % Demonstrates the ability to calculate financial ratios using data from financial statements for financial analysis and control within a corporation.	90 % Demonstrates the ability to calculate financial ratios using data from financial statements for financial analysis and control within a corporation with minimal errors.	75 % Demonstrates the ability to calculate financial ratios using data from financial statements for financial analysis and control within a corporation with a moderate amount of errors.	50 % Demonstrates the ability to calculate financial ratios using data from financial statements for financial analysis and control within a corporation with many errors.
Investment Decisions  Weight 15.00%	100 % Can apply capital requirements to investment decisions due to the cost of capital.	90 % Can apply capital requirements to investment decisions due to the cost of capital for most cases.	75 % Can apply capital requirements to investment decisions due to the cost of capital for moderate cases.	50 % Can apply capital requirements to investment decisions due to the cost of capital for few cases.
Writing Flow  Weight 14.00%	100 % Expert organization of ideas and thoughts, and expert flow from subject to subject. Great transitions.	90 % Competent organization of ideas and thoughts, and competent flow from subject to subject. Some minor transition issues.	75 % Basic organization of ideas and thoughts, and basic flow from subject to subject. Choppy at times.	50 % Consistent lack of organization of thoughts and is all over the map. Jumps around from subject to subject with no cadence.

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Description:

For this project you will be tasked to create a drawing of an image of your choice upon instructor approval.  The drawing should incorporate a variation of width of line to indicate weight and value.

THIS IS A LINE DRAWING ONLY – NO SHADING ON THIS ONE!!!

Choose a simple, everyday subject, like a shoe. Or, draw yourself — your own hand or your feet, or your face, while looking in a mirror. You can choose any object, although natural forms will offer the most variation — a flower or plant, a piece of fruit or vegetable.

Drawing requires close attention and patience. It will improve your concentration and focus, and your eye-hand coordination (ability to draw what you see).  When drawing, we try to combine two experiences — touching and looking.

Here are some tips for creating this contour drawing:

Don’t get too worried about drawing perfectly, that comes with time.
Look at your subject more than at your paper.  In fact, try not to draw while you’re looking at your paper — only draw while you’re looking at your subject.  Take your time
Don’t invent, avoid meaningless lines, and try to draw accurately only the lines that run along edges.
Use long bold lines, rather than short indecisive lines, try to keep your pencil in contact with the paper as much as possible.
Focus your eyes on some point — any point — along the contour (edge) of the subject. Imagine that your pencil or pen point is touching the subject.  Keeping your eye on the subject, follow the contours of the objects with continuous lines — no sketchy lines and no erasing.
Move your eye slowly along the contour of the object, and move your pencil slowly along the paper.  Try to feel that you are not just looking at it, but also touching the object with your pencil.
Try capturing a bit of the whole before you get into all the detail, which is an effective strategy here

Specs:

Your drawing should be a clear representation of your reference image.
You will need to use sight measurements to create accurate proportions.
Your drawing should be line only (no value added).
Weight of line should indicate light, shadow and weight in your drawing
Your submission should be scanned or photographed for online submission to this drop box.  Please be sure to that you have sufficient lighting if photographing your work so that details are clearly visible.
Materials:

Graphite Pencils
Sketchbook
Eraser

Please Photograph your drawing for submission

Criteria

Drawing should be a clear representation of your reference image (15 pts)

Weight of line should indicate light, shadow and weight in your drawing. (15 pts)