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Category > Business & Finance Posted 01 Jun 2017 My Price 6.00

If Wild Widgets, Inc.,

If Wild Widgets, Inc., were an all-equity company, it would have a beta of 1.15. The company has a target debt"?oequity ratio of 0.4. The expected return on the market portfolio is 13.5 percent, and Treasury bills currently yield 4.4 percent. The company has one bond issue outstanding that matures in 23 years and has an 7.4 percent coupon rate. The bond currently sells for $970. The corporate tax rate is 28 percent.

 

Requirement 1:

What is the company's cost of debt? (Do not include the percent sign (%). Round your answer to 2 decimal places. (e.g., 32.16))

 

Cost of debt % __________

 

Requirement 2:

What is the company's cost of equity?

 

Cost of equity % _____________

 

Requirement 3:

What is the company's weighted average cost of capital?

 

Weighted average cost of capital % ___________

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Status NEW Posted 01 Jun 2017 05:06 AM My Price 6.00

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