20. Steins Corp. has a beta of 1.8 and a standard deviation of returns of 20%. The r on the market portfolio is 8.79% and the risk free rate is 3.57%. According to CAP what is the required rate of return on Steins' stock? a. 7.63% b. 8.7296 c. 10.01% d. 12.97% 21. Jones Company has a target capital structure of 25% debt, 10% preferred stock, and 65% common equity. The company's after-tax cost of debt is 4%, its cost of preferred stock is 7%, its cost of retained earnings is l 19, and its cost of new common stock is 14%. The company stock has a beta of 1.7 and the company's marginal tax rate is 35%. What is the company's weighted average cost of capital if retained earnings are used to fund the common equity portion? a, 7.70% b.885% c. 9.45% d. 10.20% 22. Two considerations that cause a corporation's cost of capital to be different than its investors' required returns are a. corporate taxes and the earned income tax credit. b. individual taxes and dividends. corporate taxes and flotation costs. d. individual taxes and corporate taxes. 23. What is the effective annual cost of not taking advantage of the 2/10, net 60 terms offered by a supplier? Assume a 360 day year. 727% b. 982% c. 12.38% d. 14.69% 6 of 11