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pex Online has a beta of 1.4 and has a capital structure of 35% Debt and 65% Equity. The expected return on the market is

  1. pex Online has a beta of 1.4 and has a capital structure of 35% Debt and 65% Equity. The expected return on the market is 13.0% and the risk-free rate is 5.0%. Apex can borrow additional funds at the current market interest rate of 8%. The corporate tax rate for Apex is 36%.

    Calculate Apex's cost of equity.

  1. Apex Online has a beta of 1.4 and has a capital structure of 35% Debt and 65% Equity. The expected return on the market is 13.0% and the risk-free rate is 5.0%. Apex can borrow additional funds at the current market interest rate of 8%. The corporate tax rate for Apex is 36%.

    Calculate Apex's after-tax cost of debt

Apex Online has a beta of 1.4 and has a capital structure of 35% Debt and 65% Equity. The expected return on the market is 13.0% and the risk-free rate is 5.0%. Apex can borrow additional funds at the current market interest rate of 8%. The corporate tax rate for Apex is 36%.

  1. Calculate Apex's weighted average cost of capital

  1. Calculate the weighted average cost of capital for Allied Power Products given the following information:

    Market Value of Debt

    $800,000

    Market Value of Stock

    $1,000,000

    Current Yield rate of Debt

    7.5%

    Risk-free Rate

    4.0%

    Expected Market Return

    14.2%

    Beta for Allied Power

    1.4

    Corporate Income Tax Rate

    34.0%

  1. Calculate the weighted average cost of capital for AMCOM Services given the following information:

    Market Value of Stock

    $25,000,000

    Market Value of Debt

    $15,000,000

    Cost of Equity

    18.0%

    Cost of Debt

    9.5%

    Corporate Income Tax Rate

    34.0%

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