Question
The market value of Lays Corporation's equity is 50 million $ and the market value of its debt is 27 million . The current cost
The market value of Lays Corporation's equity is 50 million $ and the market value of its debt is 27 million ยง. The current cost of debt for the Co is 3.5%. The beta of the company's common stock is 0.8, the required return for the market is 89 and the risk-free rate is 2%. If we assume no taxes, what is the company's cost of capital (WACC)?
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SOLUTION The WACC weighted average cost of capital is the weighted average of the cost of equit...
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Fundamentals of Corporate Finance
Authors: Richard Brealey, Stewart Myers, Alan Marcus
7th edition
978-0077616472, 77616472, 78034647, 978-0071314749, 71314741, 978-0078034640
