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Below you are given information on Axelrod Enterprisess capital structure as well as information on Axelrods stock and bonds. Compute Axelrods cost of capital. Capital
- Below you are given information on Axelrod Enterprisess capital structure as well as information on Axelrods stock and bonds. Compute Axelrods cost of capital.
Capital Structure | |
Book Value of Debt | $2,500,000,000 |
Market Value of Debt | $2,250,000,000 |
Book Value of Equity | $3,100,000,000 |
Market Value of Equity | $4,200,000,000 |
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Stock Info |
|
Beta | 0.95 |
Risk free rate | 0.85% |
Market risk premium | 8.00% |
Bond Info |
|
Coupon rate | 5% |
Years to mat;urity | 18 |
Par value | $1,000 |
Price of bond | $1,265.25 |
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