The cost for renovating the o will cost the owners $2,000,000. currently the owner plans...
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The cost for renovating the o will cost the owners $2,000,000. currently the owner plans to raise the money needed with a loan of $1,200,000 and finance the rest via equity. for the loan , the o was only able to commit to a coupon rate of 3% which is lower than the markets going rate for a period of eight years. thus the bond will be sold at a discount of $950 what is the after tax cost of debt if the tax rate is at 30%?
The cost of equity for the owners can be estimated using the capital asset pricing model with the current T bill rate at 1.5% market risk premium at 10% and the o's beta at 1.4 what is the cost of equity
what is the weighted average cost of capital for the o?
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