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Reika [66]
3 years ago
15

Deep mines has 14 million shares of common stock outstanding with a beta of 1.15 and a market price of $42 a share. there are 90

0,000 shares of 9 percent preferred stock outstanding valued at $80 a share. the 10 percent semiannual bonds have a face value of $1,000 and are selling at 91 percent of par. there are 220,000 bonds outstanding that mature in 17 years. the market risk premium is 11.5 percent, t-bills are yielding 7.5 percent, and the firm's tax rate is 32 percent. what discount rate should the firm apply to a new project's cash flows if the project has the same risk as the firm's typical project?

Business
1 answer:
Ugo [173]3 years ago
3 0
Check the attached file for the answer.

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