1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Fynjy0 [20]
3 years ago
15

A company is 49% financed by risk-free debt. The interest rate is 8%, the expected market risk premium is 6%, and the beta of th

e company’s common stock is .59. a. What is the company cost of capital? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Cost of capital
Business
1 answer:
NemiM [27]3 years ago
3 0

Answer: 9.81%

Explanation:

Cost of capital = (cost of debt * weight of debt) + ( cost of equity * weight of equity)

Cost of Equity = Risk free rate + beta * Market risk premium

= 8% + 0.59 * 6%

= 11.54%

Cost of capital = (8% * 49%) + (11.54% * 51%)

= 9.81%

You might be interested in
Sheridan Company issued $6,500,000 of 6%, 10-year bonds for $5,614,000. The straight line method of amortization is to be used.
Mrac [35]

Answer:

The solution of the given query is explained throughout the segment below.

Explanation:

The given values are:

Company issued amount,

= $6,500,000

Rate of interest,

= 6%

Time,

= 10 years

Now,

On bonds payable amortization, the discount will be:

= \frac{6,500,000 -5,614,000}{10}

= \frac{886,000}{10}

= 88,600 ($)

Interest expenses will be:

= (6,500,000\times 6 \ percent) + 88,600

= 390,000+88,600

= 478,600 ($)

5 0
3 years ago
According to the video, what qualities do Carpenters need to have? Select three options.
r-ruslan [8.4K]

Answer:

what video? there is no video

8 0
3 years ago
Read 2 more answers
Person defines a person waiting for a heart transplant. This class is already written for you. SurvivabilityByAge defines the ra
VLD [36.1K]

Answer:

Explanation:

A heart transplant is a surgical procedure that replaces the person’s heart with a donor heart. A person may require a heart transplant for several reasons including congenital, arterial and muscle diseases or for unforeseen reasons such as accidents or viral infections.

The donor heart is matched to the recipient by blood type. More variables are also used to decide which recipient receives a heart if there are not enough hearts available for all recipients waiting for a transplant. The variables included in the decision may include the recipient state of health, cause of the heart condition and the urgency of the transplant.

The main goal of this project is for you to write a matching function that receives as a parameter the number of available hearts for transplant and will output all the recipients ranked in order of precedence.

8 0
3 years ago
Corporate governance is important to nations because: a. firms seek to invest in nations with national governance standards that
Mama L [17]

Answer:

Firms seek to invest in nations with national governance standards that are acceptable to them.

Explanation:

Corporate governance involves the way a company is been controlled by the owners or board of directors. It involves the rules by which workers abide and the hierarchy of workers.

Corporate governance is important to nations because in most cases it is the owners of a company that decide which country to invest in, and in most cases the investors critically check if the country has a suitable governing atmosphere for their business to run smoothly in.

6 0
3 years ago
Overland Corporation is authorized to issue 250,000 shares of $1 par value common stock. During 2020, Overland Corporation took
suter [353]

Answer:

See attached file

Explanation:

8 0
3 years ago
Other questions:
  • The board of directors of Benson Company declared a cash dividend of $1.50 per share on 42,000 shares of common stock on July 15
    14·1 answer
  • Real gross domestic product _______.a. is a measure of inflation. b. can change from one year to the next even if there is no ch
    13·1 answer
  • Eley Corporation produces a single product. The cost of producing and selling a single unit of this product at the company's nor
    7·1 answer
  • An advertisement touts the muscle-building benefits of a new herbal supplement. before she purchases the supplement, jana invest
    13·1 answer
  • Match each of the following contract principles to the statement that best fits it: A. bargained-for exchange of value to the pa
    10·1 answer
  • Following are transactions for Valdez Services, a company owned by Brina Valdez. A. Brina Valdez invested $20,000 cash in the co
    15·1 answer
  • Which of the following would not be characteristic of a chain restaurant?
    10·2 answers
  • Boots Plus has two product​ lines: Hiking boots and Fashion boots. Income statement data for the most recent year​ follow: Total
    6·1 answer
  • manufacturing costs for August when production was 1,000 units appear below: Direct material $12 per unit Direct labor $7,500 Va
    14·1 answer
  • Sylvia is a budget analyst for the state of Kentucky. her job is to look over the state government's spending and suggest and su
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!