Assuming that the appropriate discount rate for the project is the firm cost of capital. Determine the discount  rate to be used for evaluating the target project.

Find wacc if treasury bond yields is3.5% average market return is 9.5% and beta of 1.05 D compre b and c.

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8 5 1 2 9 6 31 ● Balley Bowls Pty Ltd (Balley Bowls) is conside new project for its expansion and the CFO has asked you to work out an appropre siscount rate to use when evaluating this project. Information about Balley Bowls's current capital structure is as follows: of Source capital Debts ● Ordinary share capital Total Book value Market value $1,200,000 $1,450,000 $1,500,000 $2,550,000 $2,700,000 $4,000,000 To finance the purchase, Balley Bowls can sell 6-year bonds paying semi-annual coupons at a rate of 8% with a face value of $1,000. The bond is expected to be sold at $942. Ordinary shares are currently selling at $32.5. The company recently paid a dividend of $2.5 this year, which is expected to grow by an average of 4% per year for the indefinite future. The current company's tax rate is 30%. Required a. Calculate the after-taxed cost of capital for each source of capital 8 5 1 2 9 6 31 ● Balley Bowls Pty Ltd (Balley Bowls) is conside new project for its expansion and the CFO has asked you to work out an appropre siscount rate to use when evaluating this project. Information about Balley Bowls's current capital structure is as follows: of Source capital Debts ● Ordinary share capital Total Book value Market value $1,200,000 $1,450,000 $1,500,000 $2,550,000 $2,700,000 $4,000,000 To finance the purchase, Balley Bowls can sell 6-year bonds paying semi-annual coupons at a rate of 8% with a face value of $1,000. The bond is expected to be sold at $942. Ordinary shares are currently selling at $32.5. The company recently paid a dividend of $2.5 this year, which is expected to grow by an average of 4% per year for the indefinite future. The current company's tax rate is 30%. Required a. Calculate the after-taxed cost of capital for each source of capital

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To calculate the aftertax cost of capital for each source of capital we need to consider the cost of ... View the full answer