What is the return on the market

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The Walt Disney Company has a beta of 1.35. The required return on Disney's equity is 12.92 percent. The risk-free rate is 2.36 percent. What is the return on the market?

Ford Motor Company's target capital structure is 74 percent debt and 26 percent equity. According to CAPM, Ford's required return on equity is 9.51 percent. The yield to maturity on Ford's outstanding bonds is 4.75 percent. Ford's current WACC is 4.85 percent. Congress recently passed a new tax plan which calls for a reduction in the corporate tax rate to 20 percent. When this plan goes into effect, by how much will Ford's WACC change? Assume all other WACC inputs remain the same.

Reference no: EM132200255

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