What is the company cost of capital

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Reference no: EM132000366

A company is 41% financed by risk-free debt. The interest rate is 11%, the expected market risk premium is 9%, and the beta of the company’s common stock is 0.51.

a. What is the company cost of capital? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Cost of capital = %

b. What is the after-tax WACC, assuming that the company pays tax at a 34% rate? (Do not round intermediate calculations. Round your answer to 2 decimal places.) After-tax WACC = %

Reference no: EM132000366

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