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Zycor Corporation obtains most of its funding internally . Assume that the stock has a beta of 1.2 the riskless rate is 6.4% and the

Zycor Corporation obtains most of its funding internally . Assume that the stock has a beta of 1.2 the riskless rate is 6.4% and the market risk premium is 6 %/

a. Estimate the cost of internal equity.

b. How assume that the cost is issuing new stock is 5% of the proceeds. Estimate the cost of external equity.

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