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suppose a firm has 26.3 million shares of common stock outstanding at a price of $10.25 per share. The firm also has 228,000 bonds outstanding
suppose a firm has 26.3 million shares of common stock outstanding at a price of $10.25 per share. The firm also has 228,000 bonds outstanding with a current price of $947. The outstanding bonds have yield to maturity 7.28%. The firms common stock beta is 0.71 and the corporate tax rate is 40%. The expected market return is 13.47% and the T-bill rate is 1.07%. Compute the following:
a) Weight of equity of the firm.
b) Weight of depth of the firm.
c) Cost of equity of the firm
d) after tax cost of debt of the firm
e) WACC for the firm
NOTE: when inputting an answer, round your answer to the nearest two decimal places. If you need to use a calculated number for further calculations, DO NOT round until after all calculations have been completed. For the final answer, round to two decimal places
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