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What is the average cost of capital when the after-tax cost of debt is 8%, the cost of equity is 12%, and the ratio of
What is the average cost of capital when the after-tax cost of debt is 8%, the cost of equity is 12%, and the ratio of equity to assets is 0.40? The financial information for Alpha and Beta Eagle are stated below. Assets $620,000 ; Liabilities $360,000 ; Returns to assets $68,200 ; Interest expense on debt $27,000 ; Income taxes $10,300 ; Consumption withdrawals $25,000 What is the rate of growth of equity capital? What is the Coefficient of Variation under both interest rate and growth risk for Zeta & Eta's farm? Pick the closest answer. Debt-to-equity ratio 2.0; Expected return on assets 12%; Expected interest rate on debt 8% ; Consumption rate 60% ; Tax rate 20% ; Standard deviation of return on assets 4% ; and Standard deviation of interest rates 2%
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