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3. A company's WACC is 9%. You also know that 60% of the company's total funding is debt and its cost of debt is 8%.
3. A company's WACC is 9%. You also know that 60% of the company's total funding is debt and its cost of debt is 8%. Disregarding taxes, what is the company's Cost of Equity? 4. Reading the news on a recent IPO, you find an article that states: ,10 minutes after trading started, the IPO campany had already reached a price of $10 per share. The day ended at $15, giving the company a $5 underpricing." Is this statement by the newspaper correct? Please answer by stating (1) Yes, (2). No, or (3) Maybe. 5. A company wants to achieve 10% in EBIT growth in the next year. All projects the company could invest in offer a 20% return. The company currently has an EBIT of $100. How much - in US-Dollars - does the company have to reinvest to achieve this desired 10% growth? (Disregard all taxes.) DELL ackapece Prones
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