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4. Amco Ltds shares have a market value of $100,000,000. The companys bonds have a market value of $50,000,000. The shares have a beta of
4. Amco Ltds shares have a market value of $100,000,000. The companys bonds have a market value of $50,000,000. The shares have a beta of 1.5. The risk free rate of interest is 4.0%. The markets expected rate of return is 8%. The bonds have a yield to maturity of 6%. If the corporate taxation rate is 30%, what is the companys weighted average cost of capital?
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