Question
A U.S based MNC raises 463 million in debt to finance its total capital needs of $180 million || Its has a tax rate of
A U.S based MNC raises 463 million in debt to finance its total capital needs of $180 million ||
Its has a tax rate of 40% || debt is the form of 5 year || 7% semiannual bonds with a face value of 1,000 || selling at $913.39, S.D of company return = 22% p.a. || Correlation Coeficient : .40 || Expected Return : 18% p.a. || SD of global stock market : 28% p.a. || RFR : 7% p.a.
What is the nominal (pre tax) cost of debt and Beta of the MNC ?
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Fundamentals Of Corporate Finance
Authors: Berk, Peter DeMarzo, Jarrad Harford
3rd Global Edition
1292018402, 9781292018409
