What is weighted average cost of capital for firm

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Reference no: EM131937805

1. A firm has a weight of debt of 10%, and a weight of equity of 90%. Bondholders earn a 6% return while stock holders earn a 13% return. The firm has an average tax rate of 31%.

What is the Weighted Average Cost of Capital for this firm?

2. A firm has a weight of debt of 10%, and a weight of equity of 90%. Bondholders earn a 6% return while stock holders earn a 13% return. The firm has an average tax rate of 31%.

What is the after-tax cost of debt for this firm?

3. Analysts at your firm are examining a project with uncertain cash flows. There is a 10% chance the project will yield an NPV of $9,300, a 60% chance the project will yield an NPV of $13,600, a 20% chance the project will yield an NPV of 1$5,300, and a 10% change the project will yield an NPV of $22,300.

What is the Coefficient of Variation of this project?

Reference no: EM131937805

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