Question
The market value of Charter Cruise Company's equity is $15 million and the market value of its debt is $5 million. If the required rate
The market value of Charter Cruise Company's equity is $15 million and the market value of its debt is $5 million. If the required rate of return on the equity is 20% and that on its debt is 8%, calculate the company's cost of capital. (Assume no taxes.)
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