Risk free rate as represented by current yield to maturity

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Reference no: EM131219108

You have estimated the beta of Ajax Ltd against the ASX200 as being 1.2. The average risk premium for the Australian market you estimate to be 6% and the risk free rate as represented by the current yield to maturity of an Australian government 10-year bond is 3.9%.

Estimate the cost of equity for Ajax Ltd, using CAPM.

(Show your answer as a percentage to one decimal place,)

Reference no: EM131219108

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