Question
Book Co. has 1.6 million shares of common equity with a par (book) value of $1.50, retained earnings of $28.2 million, and its shares have
Book Co. has 1.6 million shares of common equity with a par (book) value of $1.50, retained earnings of $28.2 million, and its shares have a market value of $49.53 per share. It also has debt with a par value of $21.1 million that is trading at 101% of par.
a. What is the market value of its equity?
b. What is the market value of its debt?
c. What weights should it use in computing its WACC?
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Personal Finance For Dummies
Authors: Eric Tyson
9th Edition
1119517893, 978-1119517894
