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13. The total market value of the common stock of the Okefenokee Real Estate Company is $9.5 million, and the total value of its debt

13. The total market value of the common stock of the Okefenokee Real Estate Company is $9.5 million, and the total value of its debt is $6.1 million. The treasurer estimates that the beta of the stock is currently 1.6 and that the expected risk premium on the market is 9%. The Treasury bill rate is 5%. Assume for simplicity that Okefenokee debt is risk-free and the company does not pay tax. a) What is the required return on Okefenokee stock? b) Estimate the company cost of capital

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