The following table presents information for Golden Fleece Financial. Calculate the company cost of capital. Ignore taxes.

Question:

Long-term debt outstanding ...........................................................$300,000

Current yield to maturity on debt..............................................................8%

Number of shares of common stock......................................................10,000

Price per share..................................................................................$50

Book value per share..........................................................................$25

Expected rate of return on stock ............................................................15%

Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...