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As a financial analyst, you are analysing Company XYZ and calculating its cost of capital. The stock price of XYZ is 100 and it has
- As a financial analyst, you are analysing Company XYZ and calculating its cost of capital. The stock price of XYZ is 100 and it has 20 million shares outstanding. XYZs debt rating is BB. The book value of debt is 600 million and market value of debt is 500 million. XYZs tax rate is 20%. Please round your results to the second digit to the right of the decimal point.
- Assume XYZs leverage ratio is fixed. Please calculate the unlevered cost of capital for Company XYZ.
[6 marks]
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Originate Motivate Innovate 7 Steps For Building A Billion Dollar Network
Authors: Shelly Omilade Bell, Sonya Renee Taylor
1st Edition
1119900549, 978-1119900542
