Question 7 Given the following information for three publically traded comparable companies, estimate the the cost of capital for an all equity financed private company in the same industry using the average industry data from the comparable public companies. The data is also included in the exam exhibit file for convenience. Levered Company Ticker Beta Debt Equity DebUEquity Freds FRD 1.96 50.0 120.0 0.42 Sobokawa SOB 1.29 5.0 275.0 0.02 Reclining REC 1.63 115.0 533.0 0.22 ВBB Согp Вond Yield 12.13% 30 Year Treas. Bond Yield 7.25%
Question 7 Given the following information for three publically traded comparable companies, estimate the the cost of capital for an all equity financed private company in the same industry using the average industry data from the comparable public companies. The data is also included in the exam exhibit file for convenience. Levered Company Ticker Beta Debt Equity DebUEquity Freds FRD 1.96 50.0 120.0 0.42 Sobokawa SOB 1.29 5.0 275.0 0.02 Reclining REC 1.63 115.0 533.0 0.22 ВBB Согp Вond Yield 12.13% 30 Year Treas. Bond Yield 7.25%
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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