Question
a company's total assets $10000 last year, liabilities $4500. at that time the interest are is 12% and tax rate 20 and capital cost is
a company's total assets $10000 last year, liabilities $4500. at that time the interest are is 12% and tax rate 20 and capital cost is 16%. the company plans to issue bonds for the following year so that the debt ratio will increase by 10% compared to last year. if, for example, debt investors and capital investors ask for a risk premium of 2% each compared to last year, calculate the size of the company's capital costs the following year
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Financial Markets and Institutions
Authors: Anthony Saunders, Marcia Cornett
6th edition
9780077641849, 77861663, 77641841, 978-0077861667
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