Estimate energetic’s cost of retained earnings

Reference no: EM131393940

Energetic Engines is trying to estimate its cost of retained earnings. The company has outstanding bonds that pay $20 interest every six months. The bonds, which have a $1,000 face value and mature in six years, are currently selling for $900. Estimate Energetic's cost of retained earnings using the bond-plus-risk-premium approach.

Reference no: EM131393940

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