1: Using financial calculator
FV=1000, PV= -1135*(1-0.07)= -1055.55
PMT=11%*1000 = 110
N=11
I/Y = Pre tax cost = 10.14%
After tax cost of debt = Pre tax cost*(1-Tax)
= 10.14%*(1-0.37)
= 6.39%
2: Cost of equity = D1/Price after flotation + g
Cost of equity = 1.5*108%/ (28*(1-0.06)) + 8%
=14.16%
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