Question
Assume that a firm belongs in a risk class for which the appropriate capitalization rate, c , is 12%, and the firm has $1,000,000 worth
Assume that a firm belongs in a risk class for which the appropriate capitalization rate, c , is 12%, and the firm has $1,000,000 worth of debt and $5,000,000 worth of stock outstanding. If the riskless interest rate is 6%, what is this firms cost of equity (kj ) according to Modigliani and Millers Proposition II?
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Climate Finance
Authors: Richard B. Stewart, Benedict Kingsbury, Bryce Rudyk
1st Edition
081474138X, 978-0814741382
