Question
XYZ Corporation . is issuing a $1,000 par value bond that pays 8% interest annually. Investors are expected to pay $975 for the 10-year bond.
XYZ Corporation . is issuing a $1,000 par value bond that pays 8% interest annually. Investors are expected to pay $975 for the 10-year bond. Bender and Co. can expect to pay an additional risk premium of 4.2% on common stock. What is the firm's cost of equity capital?
| 13.44. A | ||
| 13.60. B | ||
| 8.40. C | ||
| none of the available choices. D | ||
| 12.58. E |
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Business Analytics
Authors: Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann
5th Edition
0357902211, 978-0357902219
