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It is January 1 , 2 0 2 0 . Normal America, Inc. ( NA ) , has paid a year - end dividend in

It is January 1,2020. Normal America, Inc. (NA), has paid a year-end dividend in each of the last 10 years, as shown by the table below.
a. Calculate NAs \beta with respect to the S&P 500.
b. Suppose that the Treasury bill rate is 5.5% and that the expected return on the market is E(rM)=13%. If the corporate tax rate TC =35%, calculate NAs cost of equity using both the classic CAPM and tax-adjusted model.
c. Assume that NAs cost of debt is 8%. If the company is financed by 1/3 equity and 2/3 debt, what is its weighted average cost of capital using the CAPM model?
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