XYZ corporation has the following market value based capital structure. Long term bonds $20 billion Common equity $3
Posted: Wed May 18, 2022 11:18 pm
XYZ corporation has the following market value based capital
structure.
Long term bonds $20 billion
Common equity $30 billion
The required rate of return for the common stock is 20% and the
yield to maturity for the bonds is 10%.
The tax rate is 30%. Compute the after tax weighted average
cost of capital.
Report the answer as a percentage figure without the % symbol.
structure.
Long term bonds $20 billion
Common equity $30 billion
The required rate of return for the common stock is 20% and the
yield to maturity for the bonds is 10%.
The tax rate is 30%. Compute the after tax weighted average
cost of capital.
Report the answer as a percentage figure without the % symbol.