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Crypton Electronics has a capital structure consisting of 41%common stock and 59%debt. A debt issue of $1000par value,5.8%bonds that mature in 15years and pay annual
Crypton Electronics has a capital structure consisting of 41%common stock and 59%debt. A debt issue of $1000par value,5.8%bonds that mature in 15years and pay annual interest will sell for $975. Common stock of the firm is currently selling for $29.01per share and the firm expects to pay a $2.16dividend next year. Dividends have grown at the rate of 4.8% per year and are expected to continue to do so for the foreseeable future. What is Crypton's cost of capital where the firm's tax rate is 30percent?
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