Venture capital required rate of return. Red Devil Investors has a success rate of one project for every four funded. Red Devil has an average loan period of 2 years and requires a portfolio return of 23.5%. If you borrow from Red Devil, what is your annual cost of capital? What is the annual cost of capital? %. (Round to four decimal places.)

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
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Venture capital required rate of return. Red Devil Investors has a success rate of one project for every four funded. Red Devil has an average loan period of 2
years and requires a portfolio return of 23.5%. If you borrow from Red Devil, what is your annual cost of capital?
What is the annual cost of capital?
%. (Round to four decimal places.)
Transcribed Image Text:Venture capital required rate of return. Red Devil Investors has a success rate of one project for every four funded. Red Devil has an average loan period of 2 years and requires a portfolio return of 23.5%. If you borrow from Red Devil, what is your annual cost of capital? What is the annual cost of capital? %. (Round to four decimal places.)
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