2008 CFA Level 1 － Sample 样题(3)－Q47 face, determine, average, capital, equity

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47、Sorbonne Systems Incorporated wants to determine the cost of equity that can be used in the calculation of the weighted average cost of capital. The CFO has gathered the following information:

Rate of return on 3-month Treasury bills 3.0%

Rate of return on 10-year Treasury bonds      3.5%

Market equity risk premium      6.0%

Sorbonne's estimated beta        1.6

Sorbonne's before-tax cost of debt 8.0%

Risk premium of equity over debt     4.0%

Using the capital asset pricing model (CAPM) approach and the bond yield plus risk premium approach, respectively, the cost of equity for Sorbonne is closest to:

     CAPM   Bond yield plus risk premium

A. 12.6%    12%

B.   12.6%    14%

C. 13.1%    12%

D. 13.1%    14%

A. Answer A

B. Answer B

C. Answer C

D. Answer D

 

csmis

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songxiao2981

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cat2011

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babynian

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galenc

c

galenc

b

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