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looking for part D a. ABC currently has outstanding 12-year bond with 7% coupon that pays semiannually, the current market price is $1075. What is
looking for part D
a. ABC currently has outstanding 12-year bond with 7% coupon that pays semiannually, the current market price is $1075. What is ABC's cost of debt? (8 points) -tate(12*21 000*790/2-1075, 1000))*2 -ABC cost of debt is 6.11% ABC's beta is 1.15, the 20-year T-bond has a yield to maturity(YTM) of 3.25%, and the market risk premium is 7.5%. What is ABC's cost of common stock? (5 points) -3.24% + 7.5% * 1.15 -ABC cost of common stock is 1 1.875% b. ABC's preferred dividend is S3.75 dollar and the price of ABC's preferred stock is $50. What is ABC's cost of preferred stock? (8 points) c. ABC cost of preferred stock is 7.5% Last year, ABC had earning per share (EPS) of S3.5, and ABC paid $1.6 in dividend per share. Given ABC's ROE is 9%, what is ABC's growth rate for common stock? (8 points) dStep by Step Solution
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