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Ganado and Equity Risk Premiums. Maria? Gonzalez, Ganado's Chief Financial? Officer, estimates the? risk-free rate to be 3.70%?,the? company's credit risk premium is 4.10?%,the domestic

Ganado and Equity Risk Premiums. Maria? Gonzalez, Ganado's Chief Financial? Officer, estimates the? risk-free rate to be 3.70%?,the? company's credit risk premium is 4.10?%,the domestic beta is estimated at 1.01?,the international beta is estimated at 0.68?,and the? company's capital structure is now 30?% debt. The? before-tax cost of debt estimated by observing the current yield on? Ganado's outstanding bonds combined with bank debt is8.10?% and the? company's effective tax rate is 39?%. Calculate both the CAPM and ICAPM weighted average costs of capital for the following equity risk premium estimates.

a.8.10?%

b.7.20?%

c.5.20?%

d.4.10?%

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