Question
gInoring your answers to a and b and the information provided above... Assume the following information for Marriott Corporation; Division Asset Value in Each Division
gInoring your answers to a and b and the information provided above... Assume the following information\ for Marriott Corporation;\ Division Asset Value in\ Each Division of\ Marriott stated in\ Millions of\ Dollars\ Equity Value\ Investment in\ Each Division\ stated in\ Millions of\ Dollars\ Debt Value\ Investment in\ Each Division\ stated in\ Millions of\ Dollars\ Beta of the\ assets, Beta\ unlevered\ Hotel 1,250 750 500 1.0\ Restaurant 550 300 250 .75\ Contract\ Services\ 350 100 250\ Entire Firm 2,150 1,150 1,000 1.25\ Determine the weighted average cost of capital for the contract services division where:\ Target D/E = 2.0; Rd = .08; Rf = .06; (Rm-Rf) = .07; tc=.40
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