What is the firms cost of equity capital


Problem: A firm has a target capital structure of 30% equity and 70% debt. The firm's tax rate is 35% and the yield to maturity on the firm's outstanding bonds is 8.2%. The firm's weighted average cost of capital is 8.76%. What's the firm's cost of equity capital?

Solution Preview :

Prepared by a verified Expert
Finance Basics: What is the firms cost of equity capital
Reference No:- TGS02057259

Now Priced at $20 (50% Discount)

Recommended (97%)

Rated (4.9/5)