The Excel file C8 Problem 13.xls available at www.mhhe.com/ higgins90 (Select Student Edition >Choose a Chapter > Excel Spreadsheets) provides key facts and assumptions concerning Kroger Company, a large supermarket chain, on December 12, 2007. Using this information,

a. Estimate Kroger's cost of equity capital.

b. Estimate Kroger's weighted-average cost of capital. Prepare a spreadsheet or table showing the relevant variables.

AppendixLO1