Homework Help is Here – Start Your Trial Now!
Business
Accounting
18. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the volatility of stocks or beta. a) 1.00% b) 1.25% c) 1.50% d) 1.75% 19. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the after-tax cost of debt. a) 4.90%

18. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the volatility of stocks or beta. a) 1.00% b) 1.25% c) 1.50% d) 1.75% 19. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the after-tax cost of debt. a) 4.90%

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
18. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the volatility of stocks or beta. a) 1.00% b) 1.25% c) 1.50% d) 1.75% 19. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the after-tax cost of debt. a) 4.90% b) 5.00% c) 7.00% d) 10.00%
Transcribed Image Text:18. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the volatility of stocks or beta. a) 1.00% b) 1.25% c) 1.50% d) 1.75% 19. The appropriate WACC of a firm is 6.43%. With risk-free rate of 4%, market return of 8% prevailing credit spread of 3% tax rate of 30% and Equity ratio of 30%, compute for the after-tax cost of debt. a) 4.90% b) 5.00% c) 7.00% d) 10.00%
Expert Solution
steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS