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Modi Corp has 1 , 4 0 0 , 0 0 0 shares outstanding, and the stock is currently trading at $ 1 6 .
Modi Corp has shares outstanding, and the stock is currently trading at $ per share. The company has two different bonds outstanding. First, it has zero coupon bonds outstanding. Each zero coupon bond has a face value of $ will mature in years, and is currently priced at of face value. Second, the company has coupon paying bonds outstanding. Each coupon paying bond is currently priced at $ and the YTM is You have decided to calculate the cost of equity using the SML equation. You have estimated that the riskfree rate is and the expected rate of return on the market portfolio is You also have estimated that the equity beta of the company is Finally, the company faces a tax rate of Using the information given, calculate the cost of capital WACC of Modi Corp.
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