Company name Company ticker Fox Corporation FOX Year 2019 Risk free rate Market risk premium Beta 2.10% 30-year T-bond rate 5.00% historical average, or implied 1.59 equity beta, or levered beta BBB morningstar.com, or Factset 21% Bond rating Tax rate 2 3 D/(D+E) 40.40% long-term debts / capital 4 Spread 12.00% 9.00% 7.50% 6.00% 5.00% 4.00% 3.00% 5 -6 bond rating table 17 Rating 18 D 19 20 CC 21 22 B- 23 B 24 B+ 25 BB 26 BBB 27 A- A 29 A+ 30 AA 31 AAA 32 33 34 35 36 37 38 interest rate 14.10% 11.10% 9.60% 8.10% 7.10% 6.10% 5.10% 4.60% 4.10% 3.60% 3.35% 3.10% 2.80% 2.40% 28 2.50% 2.00% 1.50% 1.25% 1.00% 0.70% 0.30% Fill in the blue color cells Use the inputs in the previous worksheet to answer the questions here. Turn in this file to Canvas "Assignments" Cost of equity bond rating table before-tax interest rate Cost of debt (after-tax) 40.40% debt ratio D/(D+E) 5 6 E/(D+E) 7 B WACC equity ratio 0 1 If the debt ratio increases and the bond rating worsens, 2 the equity beta will be (higher, lower, or uncertain) 13 the cost of equity will be (higher, lower, or uncertain) the cost of debt after-tax will be (higher, lower, or uncertain) 25 the WACC will be (higher, lower, or uncertain) 26 27 28