The Angelina Corporation’s common stock has a beta of 1.6. If the risk-free rate is 4.7 percent and the expected return on the market is 13 percent, what is the company’s cost of equity capital? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity capital: _______

The Angelina Corporation’s common stock has a beta of 1.6. If the risk-free rate is 4.7 percent and the expected return on the market is 13 percent, what is the company’s cost of equity capital? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity capital: _______

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 14P

See similar textbooks

Similar questions

An analyst has modeled the stock of a company using the Fama-French three-factor model. The market return is 10%, the return on the SMB portfolio (rSMB) is 3.2%, and the return on the HML portfolio (rHML) is 4.8%. If ai = 0, bi = 1.2, ci = 20.4, and di = 1.3, what is the stock’s predicted return?
The Lenzie Corporation's common stock has a beta of 1.80. If the risk - free rate is 4.9% and the expected return on the market is 11%, what is the company's cost of equity capital? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places.) Cost of equity capital %
The Hudson Corporation’s common stock has a beta of 1.4. If the risk-free rate is 4.5 percent and the expected return on the market is 11 percent, what is the company’s cost of equity capital? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity capital % Johansen Corporation has a target capital structure of 60 percent common stock and 40 percent debt. Its cost of equity is 12 percent, and the cost of debt is 6 percent. The relevant tax rate is 30 percent. What is the company's WACC? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC %
Wild Swings, Inc.'s stock has a beta of 2.09. If the risk-free rate is 5.99% and the market risk premium is 7.11%, what is an estimate of Wild Swings' cost of equity? Wild Swings's cost of equity capital is __ % ? (Round to two decimal places.)
The Up and Coming Corporation's common stock has a beta of 1.29. If the risk-free rate is 0.04 and the expected return on the market is 0.08, what is the company's cost of equity capital? Enter the answer with 4 decimals (e.g. 0.1234).
Steady Company's stock has a beta of 0.15. If the risk-free rate is 5.9% and the market risk premium is 6.8%, what is an estimate of Steady Company's cost of equity? Steady's cost of equity capital is _________%.
The Rhaegel Corporation's common stock has a beta of 1.1. If the risk-free rate is 4.5 percent and the expected return on the market is 15 percent, what is the company's cost of equity capital? Multiple Choice 21% 16.69% 15.25% 16.05% 16.85%
Express Steel Corporation wishes to calculate its cost of common stock equity, by using the capital asset pricing model (CAPM). The firm’s investment advisors and its own analysts indicate that the risk-free rate equals 9,1%; the firm’s beta equals 0,75; and the market return equals 16%. Please estimate the cost of common stock equity by using CAPM.
The DR Company’s common stock has a beta of 1.07. What is the company’s cost of equity capital if the risk-free rate is 3.5% and the expected return on the market is 10%?
Hoolahan Corporation’s common stock has a beta of 1.11. Assume the risk-free rate is 4.6 percent and the expected return on the market is 12.1 percent. What is the company’s cost of equity capital? (
You researched Turnkey Investment's financial data and gathered the following information: Current price per share of stock $72 Expected market risk premium 9.9% financial reports clipart Dividend per share paid just recently = $ 5.32 Risk free interest rate 6% Expected annual growth of dividend per share 5% Stock Beta 1.87 Calculate the company's cost of equity using the Dividend Growth Model approach. Your answer should be in percent, not in decimals: e.g., 12.34 rather than 0.1234
Preston knows his firm's stock has a beta of 1.17, and he'd like to use the CAPM to estimate the cost of equity. If the expected market risk premium is 8.7% and the current T-Bill rate is 2.5%, what should he use as the estimate for the cost of equity? Enter your answer as a decimal and show 4 decimal places. For example, if your answer is 15.55%, enter .1555.