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Question 1 4 options: Strolling Corporation is constructing its Cost of Capital schedule. The firm is at its target capital structure. Its 1 5 year
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Strolling Corporation is constructing its Cost of Capital schedule. The firm is at its target capital structure. Its year bonds have a coupon rate and sell for $ Bond coupons are semiannual. Rolling's stock beta is the riskfree rate is and the return on the market portfolio is Rolling is a constant growth firm, and just paid a dividend of $ The stock sells for $ and has a growth rate of The firm's tax rate is The firm's book value balance sheet is as follows: Assets $ Long Term Debt $ Equity $ par $ Retained Earnings $ Comprehensive Income To the nearest what is the weight of debt that should be used used in computing the Weighted Average Cost of Capital?
To the nearest what is the pretax cost of debt?
To the nearest what is the cost of retained earnings using the Constant Growth Model?
To the nearest what is the cost of equity using the Capital Asset Pricing Model?
Using your Capital Asset Pricing Model cost of equity, to the nearest what is Strolling's Weighted Average Cost of Capital?
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