Homework Answers
Beta = 0.84
Risk-free rate = 3.7%
Market risk premium = 4.9%
Cost of capital = Risk-free rate + [beta * Market risk premium]
Cost of capital = 3.7% + [0.84 * 4.9%]
Cost of capital = 7.8 %
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10.4
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Quantitative Problem: Barton Industries estimates its cost of common equity by using three approaches: the CAPM,...
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10.4
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