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The Rhaegel Corporation's common stock has a beta of 1.1. If the risk-free rate is 4.2 percent and the expected return on the market is 12 percent, what is the company's cost of equity capital? (Do not round Intermedlate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

The Rhaegel Corporation's common stock has a beta of 1.1. If the risk-free rate is 4.2 percent and the expected return on the market is 12 percent, what is the company's cost of equity capital? (Do not round Intermedlate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 14P
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The Rhaegel Corporation's common stock has a beta of 11. If the risk-free rate is 4.2 percent and the expected return on the market is 12 percent, what is the company's cost of equity capital? (Do not round Intermedlate calculatlons and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity capital 13.79 %
Transcribed Image Text:The Rhaegel Corporation's common stock has a beta of 11. If the risk-free rate is 4.2 percent and the expected return on the market is 12 percent, what is the company's cost of equity capital? (Do not round Intermedlate calculatlons and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of equity capital 13.79 %
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