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Suppose a firm has 12.50 million shares of common stock outstanding at a price of $19.07 per share. The firm also has 415000.00 bonds outstanding
Suppose a firm has 12.50 million shares of common stock outstanding at a price of $19.07 per share. The firm also has 415000.00 bonds outstanding with a current price of $1,167.00. The outstanding bonds have yield to maturity 8.97%. The firm's common stock beta is 1.397 and the corporate tax rate is 40.00%. The expected market return is 10.79% and the T-bill rate is 5.01%. Compute the following: |
a) Weight of Equity of the firm: |
b) Weight of Debt of the firm: |
c) Cost of Equity of the firm: |
d) After Tax Cost of Debt of the firm: |
e) WACC for the firm: |
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