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Please help me with a,b,c. Help me understand and show your work. Thank you Cheggs answer is incorrect 21. Cost of Capital Harris, Inc., has
Please help me with a,b,c. Help me understand and show your work. Thank you
Cheggs answer is incorrect
21. Cost of Capital Harris, Inc., has equity with a market value of $18.5 million and debt with a market value of $7.3 million. Treasury bills that mature in one year yield 4 percent per year and the expected return on the market portfolio is 11 percent. The beta of the company's equity is 1.15 . The firm pays no taxes. a. What is the company's debt-equity ratio? b. What is the firm's weighted average cost of capital? c. What is the cost of capital for an otherwise identical all-equity firmStep by Step Solution
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