Q14. The following data is regarding the Link Company: - A target debt/equity ratio of 0.5
- Bonds are currently yielding 10%
- Link is a constant growth firm that just paid a dividend of $3.00
- Stock sells for $31.50 per share, and has a growth rate of 5%
- Marginal tax rate is 40%
What is Link's after-tax cost of capital? A) 10.5%. B) 12.0%. C) 12.5%.
Q15. In calculating the weighted average cost of capital (WACC), which of the following statements is least accurate? A) Different methods for estimating the cost of common equity might produce different results. B) The cost of debt is equal to one minus the marginal tax rate multiplied by the coupon rate on outstanding debt. C) The cost of preferred equity capital is the preferred dividend divided by the price of preferred shares.
| 
发表于 2009-1-22 09:36
| 
