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Suppose Pepsicos stock has a beta of 0.57. If the risk-free rate is 3% and the expected return of the market portfolio is 8%. The
Suppose Pepsicos stock has a beta of 0.57. If the risk-free rate is 3% and the expected return of the market portfolio is 8%. The company is financed by 40% risk-free debt and pays a corporate tax rate of 25%. Calculate Pepsicos after-tax company cost of capital. a. 5.44 percent b. 5.74 percent c. 7.56 percent d. 4.37 percent
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