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please answer all from a to h please Ferrari's IPO and WACC. Ferrari, the famous high-performance automotive group, launched its initial public offering (IPO) on
please answer all from a to h please
Ferrari's IPO and WACC. Ferrari, the famous high-performance automotive group, launched its initial public offering (IPO) on October 20, 2015. Although the share price had initially risen to over 63 euros () per share, by the end of the year it had settled to 53 euros (). Ferrari had been owned by Fiat (Italy), and had never calculated its own cost of capital before, one independent of Fiat. It now needed to, and one of its first challenges was estimating its beta. With only two months of trading to base it on, the corporate treasury group had started with what were considered "comparable firms", which for Ferrari, meant firms in the luxury goods industry, not automotive. Luxury goods were historically less volatile than the market, so the initial guess on Ferrari's beta was 0.72 . Use the assumptions in the popup table, , to answer the following questions. a. What is Ferrari's cost of debt, after-tax, in euros? b. What is Ferrari's cost of equity in euros? c. What is Ferrari's market capitalization? d. What is Ferrari's total value of equity outstanding? e. What proportion of Ferrari's capital structure is equity? f. What proportion of Ferrari's capital structure is debt? g. What is Ferrari's weighted average cost of capital? h. What is Ferrari's WACC if its beta was higher, like other automotive companies, say 1.31? a. What is Ferrari's cost of debt, after-tax, in euros? \% (Round to two decimal places.) Data tableStep by Step Solution
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