Q1. Moby Ltd has provided you with the following information. All rates are effective annual rates. Assume a classical tax system.

Calculate the firms required return on equity (rE), after tax cost of debt, weighting of Debt (D/V) and the companys after-tax WACC.

The company has bonds on issue with a face value of $1,000 that currently pay a coupon of $60 every six months. These bonds currently trade at par. 10-year Government Bonds yield 2% and the market risk premium is 5% pa. The beta of the company's equity is 1.5 The debt-to-equity ratio is 2.3:1 The corporate tax rate is 30% Provide all answers as decimals rounded to 6 decimal places