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SaxaCo has a debt-equity ratio of 0.87. The current beta on SaxaCo's common stock is 1.16. The risk-free rate is assumed to be 2.9% and
SaxaCo has a debt-equity ratio of 0.87. The current beta on SaxaCo's common stock is 1.16. The risk-free rate is assumed to be 2.9% and the market risk premium is assumed to be 6.66%. SaxaCo has a pretax cost of debt of 6.61% and pays an effective tax rate of 35%. What is SaxaCo's unlevered cost of capital
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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
12th Edition
978-0030243998, 30243998, 324422695, 978-0324422696
