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Intro Epson has one bond outstanding with a yield to maturity of 6% and a coupon rate of 8%. The company has no preferred stock.
Intro Epson has one bond outstanding with a yield to maturity of 6% and a coupon rate of 8%. The company has no preferred stock. Epson's beta is 1.5, the risk-free rate is 1% and the expected market risk premium is 6%. Epson has a target debt/equity ratio of 0.7 and a marginal tax rate of 34%. Io | Attempt 1/10 for 10 pts. Part 1 What is Epson's (pre-tax) cost of debt? 4+ decimals Submit IB Attempt 1/10 for 10 pts. Part 2 What is Epson's cost of equity? 3+ decimals Submit Part 3 18 Attempt 1/10 for 10 pts. What is Epson's capital structure weight for equity, i.e., the fraction of long- term capital provided by equity? 3+ decimals Submit
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