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Please answer number 1 and 2. They are related thank you. 1. We have the following information for Anheuser-Busch Companies, Inc pany Beta Market Market
Please answer number 1 and 2. They are related thank you.
1. We have the following information for Anheuser-Busch Companies, Inc pany Beta Market Market | Bond Value Value Rating of Debt Equity 40605 5375 A+ of 0.5 Anheuser- Busch Assuming no tax is paid. Furthermore, we have the following economy-wide information Government Bond yields 10-year 4.5% Bond yield spreads (ie. bond yield - risk free rate) for A+ rating 10-year 1.00% Assume that the expected return on the S&P 500 is 10%. Estimate Anheuser-Buschs WACC using this information. 2. Identical Twin Beer, Co. has exactly the same business risk as Anheuser-Busch, but it has 100% of equity and no debt. According to the data in question 1, what is the beta of Identical Twin? What is its cost of capitalStep by Step Solution
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