A project has an expected risky cash flow of $500 in year 3. The risk-free rate is 4%, the expected market rate of return is 14%, and the project's beta is 1.20. Calculate the ratio of the certainty equivalent cash flow to expected risky cash flow in year 3.

Question options:

	0.7207
	0.6381
	0.8966
	0.8609

The market value of Charcoal Corporation's common stock is $20 million, and the market value of its risk-free debt is $5 million. The beta of the company's common stock is 1.25, and the market risk premium is 8%. If the Treasury bill rate is 5%, what is the company's after-tax WACC assuming the marginal tax rate is 30%?

Question 4

0 / 6.25 points

Question options:

	9.10%
	7.70%
	12.7%
	12.3%