a. Fury Ltd's equity has beta of 1.3. If the expected market return is 12% and the risk-free rate is 4%. Calculate the cost of eqwuity of Fury Limited. ( Show answer as a percentage correct to 1 decimal place).
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a. Fury Ltd's equity has beta of 1.3. If the expected market return is 12% and the risk-free rate is 4%. Calculate the cost of eqwuity of Fury Limited. ( Show answer as a percentage correct to 1 decimal place).
b. Ironbark Ltd has a new factory under consideration, which is expected to generate before tax cash flows of $2,500,000 forever. Ironbark Ltd is currently operating at its target debt-to-equity ratio of 0.25. The new factory is expected to cost $10,000. The company tax rate is 30%. The company wishes to raise the fund for the new project by a new issue of 20-year bonds with a yield to maturity of 9% p.a. (the flotation costs of the new debt would be 4% of the amount raised) and a new issue of ordinary shares with a required return of 16% p.a.(the flotation costs of the new share issue would be 14% of the amount raised). Calculate the
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