Consider a world with no bankruptcy costs perfect capital markets and in which all firms pay a 30 tax rate Enormous Corp has three operating divisions the foods electronics and chemicals divisions account for 50 30 and 20 of Enormous assets value respectively Currently the firms capital structure is 40 riskfree zerobeta debt The expected market return is 9 and the current riskfree interest rate is 3 To help work out the divisional cost of capital the following three competitors who also have ris