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answer the parts from b till e Question 22 of 3 Save 10 points CC Sample Problem 1. Sanstreet, Inc. went public by Issuing 1
answer the parts from b till e
Question 22 of 3 Save 10 points CC Sample Problem 1. Sanstreet, Inc. went public by Issuing 1 million shares of common stock @ AED 25 per share. The shares are currently trading at AED 30 per share. Current risk free rate is 4%, market risk premium 8% and the company has a beta coefficient of 1.2. During last year, it issued 50,000 bonds of AED 1,000 par paying 10% coupon annually maturing in 20 years. Bond Yield is 10.6%. The bonds ar currently trading at AED 950. The tax rate is 30%. Calculate the weighted average cost of capital. (10 Points). SHOW WORK ON WORKSHEET QUESTION FOR PARTIAL CREDIT. a. What is Firm X's after-tax cost of debt to nearest one decimal? % (2 points) b. What is Firm X's cost of equity? to nearest one decimal? % (2 points) 5. What is Firm X's weight of debt? to nearest one decimal? % (2 points) b. What is Firm X's cost of equity? to nearest one decimal? % (2 points) c. What is Firm X's weight of debt? to nearest one decima!? % (2 points) d. What is the weight of equity? to nearest one decima!? % (2 points) e. What is Firm X's WACC? to nearest two decimals? % (2 points)Step by Step Solution
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