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Cosmo has a weighted average cost of capital of 7.65%.Estimate Cosmo's cost of equity given the following information:The firm's effective tax rate is 25%, they
Cosmo has a weighted average cost of capital of 7.65%.Estimate Cosmo's cost of equity given the following information:The firm's effective tax rate is 25%, they have an equal mix of debt and equity, the required return on the market portfolio is 9%, Cosmo has a before-tax cost of debt of 6%, and the risk-free rate of return is 3%.
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