What is the company weighted average cost of capital

Reference no: EM13274723

Jones Company has a target capital structure of 30% debt, 15% preferred stock, and 55% common equity. The company's after-tax cost of debt is 7%, its cost of preferred stock is 11%, its cost of retained earnings is 15%, and its cost of new common stock is 16%. The company stock has a beta of 1.5 and the company's marginal tax rate is 35%. What is the company's weighted average cost of capital if retained earnings are used to fund the common equity portion. 11.20% 12.00% 13.80% 14.45%

Reference no: EM13274723

Questions Cloud

Determine the current i required to produce the b-field : a. Determine the current I(t) required to produce the B-field 2cos(wt)(T) in terms of other variables, for a sinusoidal field of 60 Hz, and N=100 turns. b. Now assume that you have the above B-field generated inside the solenoid.

Find the gauge pressure at the bottom of the jar : A creamy salad dressing is made up of heavy cream, corn oil, If the cream layer is 2.20×10?2 m tall, the oil layer 2.80×10?2 m tall, and the vinegar layer 8.000e-3 m tall, what is the gauge pressure at the bottom of the jar

Compute the volume of koh solution needed to neutralize : Calculate the volume of a 2.00 M KOH solution needed to neutralize 40.0 mL of a 0.600 M H2SO4 solution.

How modern electronics technology affects positively lifes : which semiconductor device and circuit technologies made the wide spread of mobile communications possible How modern electronics technology affects positively and negatively your personal life, the work environment and the global society

What is the company weighted average cost of capital : What is the company's weighted average cost of capital if retained earnings are used to fund the common equity portion. 11.20% 12.00% 13.80% 14.45%

What is the value of the ideal gas constant : Given the standard molar volume of gas is 22.71 L/mol at a temp of 273.15K and a pressure of 1 bar, what is the value of the ideal gas constant

What is the net cash flow of the project for following years : Negative amounts should be indicated by a minus sign. Round your answers to 2 decimal places. (e.g., 1,234,567.89)) Net cash flow Year 0 $ Year 1 $ Year 2 $ Year 3 $ (b) What is the NPV of the project?

Define how a phospholipid differs from other fatty acids : Describe how a phospholipid differs from other fatty acids. How does this difference allow the formation of a bilayer in an aqueous medium

What is sensitivity analysis and what is its purpose : Explain how simulation works what is the value in using a simultion approach. N. What is sensitivity analysis and what is its purpose?

User Account

All Pages