WHAT IS THE COST OF EQUITY IF CORPORATE TAX RATE IS
Easy Car Corp. is a grocery store located in the Southwest. It paid an annual dividend
of $ last year to its shareholders and plans to increase the dividend annually at
the rate of It currently has common shares outstanding. The shares
currently sell for $ each. The common stock beta is Easy Car Corp. also has
semiannual bonds outstanding with a coupon rate of a maturity of
years, and a par value of $ The bonds currently have a yield to maturity YTM
of The riskfree rate is and the market risk premium is
What is the best estimate of the cost of equity for Easy Car Corp. if the corporate tax
rate is
When answering this problem enter your answer using percentage notation but do
not use the symbol and use two decimals rounding For example, if your answer is
then enter ; if your answer is then enter
Your Answer:
