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Hi, i'm trying to figure this out from the case Midland and i'm so confused. can you help teach me? How do you Calculate unlevered

Hi, i'm trying to figure this out from the case Midland and i'm so confused. can you help teach me?

How do you Calculate unlevered cost of capital (rA) for the Petrochemical division. How would you go about? Calculate the WACC for the Petrochemical division.

WACC Petrochemical

10-year yield to U.S. Treasury Bonds 4.66%

Overall Consolidated Spread to Treasury 1.35%

RD 6.01%

Tax Rate 39.00 %

EMRP 5 %

(Beta) 1.4

rf 4.66 %

re 11.66 %

D/E 117.8 %

D/V 0.540863

E/V 0.459137

WACC 0.073364

7.336394 %

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