Question
Brooks Robinson Motors has a target capital structure of 60% debt and 40% equity. The yield to maturity on the companys outstanding bonds is 9%,
Brooks Robinson Motors has a target capital structure of 60% debt and 40% equity. The yield to maturity on the companys outstanding bonds is 9%, and the companys tax rate is 35%. Robinsons CFO has calculated the companys WACC as 8.50%. What is the companys cost of equity capital?
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Middle Market M And A Handbook For Advisors Investors And Business Owners
Authors: Kenneth H. Marks, Christian W. Blees, Michael R. Nall, Thomas A. Stewart
2nd Edition
1119828104, 978-1119828105
