Question
Firm has the following equity & debt metrics EQUITY Current stock price = $16.92 Shares outstanding = 86,850,000 Firm beta = 0.85 Firm tax rate
Firm has the following equity & debt metrics
EQUITY
Current stock price = $16.92
Shares outstanding = 86,850,000
Firm beta = 0.85
Firm tax rate = 28.00%
Market Risk Premium (Rm Rf) = 8.00%
Treasury Yield = 1.25%
DEBT
Two separate debt issues
Book value of # 1 = $475,000,000
Market value of # 1 = 106.25% of par value
Market YTM of # 1 = 4.64%
Book value of # 2 = $125,000,000
Market value of # 2 = 109.50% of par value
Market YTM of # 2 = 5.20%
The firm is financed with what proportion of equity?
| 69.61% | ||
| 74.61% | ||
| 64.61% | ||
| 79.61% | ||
| 59.61% |
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Handbook Of Recent Advances In Commodity And Financial Modeling
Authors: Giorgio Consigli, Silvana Stefani, Giovanni Zambruno
1st Edition
3319613189, 978-3319613185
