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2- A company went public by issuing 500.000 shares of common stock at 10 TL per share. The shares are currently traded with a 40%
2- A company went public by issuing 500.000 shares of common stock at 10 TL per share. The shares are currently traded with a 40% premium. Current benchmark government bond rate is 8%, market return is 20% and the company has an unlevered beta coefficient of 0.26. At the beginning of the year, it issued 50,000 bonds of 1,000 TL par paying 10% coupon annually maturing in 20 years. The yield to maturity is always 10,61%. The bonds are currently trading with 80 TL discount. If the tax rate is 20%, what would be the approximate weighted average cost of capital (WACC) using the market values of debt and equity? 11.00% 8,84% 10.58% 9.28% Diger: CamScanner ile tarandi BONUS QUESTION - Refer to Question 2 above. What would be the WACC If you used book values of debt and equity? SHOW YOUR CALCULATIONS
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