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Geothermal's cost of debt is 5.1%, the cost of equity is 11.1% and the tax rate is 28%. The company uses 20% of debt in
- Geothermal's cost of debt is 5.1%, the cost of equity is 11.1% and the tax rate is 28%. The company uses 20% of debt in its capital structure; the rest is equity. The weighted average cost of capital for the company % (accurate to 4 decimals)
- Question 2
- Geothermal's cost of debt is 4.2%, the dividend yield on the preferred is 6.4%, the cost of equity is 10.9%, and the tax rate is 22%. The company uses 11% of debt in its capital structure and 22% of preferred; the rest is common equity. The weighted average cost of capital for the company (accurate to 4 decimals)
- Question 3
- The perpetual debt tax shield reflects the PV of all future tax savings due to interest deductibility.
- If Revenues are $5000, CoGS are $3000, interest rate on Debt is 7.7%, Debt is $1,752, the tax rate is 32.5%, then
- the perpetual tax shield.
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