Each die has six numbers, the total number of possible combinations is 6 * 6 = 36
The combinations in which you can get a sum of 5 are: 1 &4, 2 & 3, 4 &1, 3 &2
There are 4 different combinations of getting a sum of 5.
The probability would be 4/36, which reduces to 1/9
Beta= 1.3
Debt to equity ratio= 0.4
Market rate of return= 11.6%
= 11.6/100
= 0.116
Tax rate= 32%
= 32/100
= 0.32
Risk free rate= 3.3%
= 3.3/100
= 0.033
Pretax cost of debt= 7.2%
= 7.2/100
= 0.072
The firm's WACC can be calacluated as follows
RS= 0.033+1.3(0.116-0.033)
= 0.033+1.3(0.083)
= 0.033+0.1079
= 0.1409
WACC= (1/1.4)(0.1409)+(2/1.4) (0.072)(1-0.32)
= (0.7142)(0.1409) + (1.4285)(0.072)(0.68)
= 0.1006+0.0699
= 0.1705(100)
= 17.05%
Hence the firm's WACC is 17.05%
Answer: No
f(g(x))=1
g(f(x))=2
Because f(g(x)) ≠ g(f(x)) The compositions are not commutative
