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Ivanhoe Corporation is financed with debt, preferred equity, and common equity with market values of $25 million, $14 million, and $30 million, respectively. The betas
Ivanhoe Corporation is financed with debt, preferred equity, and common equity with market values of $25 million, $14 million, and $30 million, respectively. The betas for the debt, preferred stock, and common stock are 0.2, 0.4, and 1.1, respectively. The risk-free rate is 3.96 percent, the market risk premium is 6.07 percent, and Ivanhoe's average and marginal tax rates are both 30 percent. Excel Template (Note: This template includes the problem statement as it appears in your textbook. The problem assigned to you here may have different values. When using this template, copy the problem statement from this screen for easy reference to the values you've been given here, and be sure to update any values that may have been pre-entered in the template based on the textbook version of the problem.) (a1) - Your answer is partially correct. What is the company's cost of capital? (Round intermediate calculation to 4 decimal places, e.g. 1.2512 and final answers to 3 decimal places e.g. 5.215%.) Costs of debt 5.174 Costs of common equity 10.637 Costs of preferred equity 6.388 Attempts: 1 of 2 used
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