Tipialo Solutions Inc has 3 business segments with their respective asset value and asset beta as follows. The company's marginal tax rate is 20%. Segment Asset value Asset beta Technology 2200 Insurance 600 Staples A. 1.6091 1.6200 OB. The company has 3000 in total assets and a debt-to-equity ratio of 1/2. The company wants to divest both of its insurance and staples divisions and uses the proceeds to repay debt (i.e. reduce the current debt balance). How much is the equity beta of the company after the divestiture? C. 1.7164 OD. E. 200 1.7280 1.6 0.8 1 Time left 0:51 None of the answers given in A., B., C. and D. are correct.
Cost of Debt, Cost of Preferred Stock
This article deals with the estimation of the value of capital and its components. we'll find out how to estimate the value of debt, the value of preferred shares , and therefore the cost of common shares . we will also determine the way to compute the load of every cost of the capital component then they're going to estimate the general cost of capital. The cost of capital refers to the return rate that an organization gives to its investors. If an organization doesn’t provide enough return, economic process will decrease the costs of their stock and bonds to revive the balance. A firm’s long-run and short-run financial decisions are linked to every other by the assistance of the firm’s cost of capital.
Cost of Common Stock
Common stock is a type of security/instrument issued to Equity shareholders of the Company. These are commonly known as equity shares in India. It is also called ‘Common equity
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