3. Insco Inc. has the balance sheet as shown below. Recently the yield on bonds similar to the ones that company has had fallen to 4.5%, so that the market value of the bonds is now about $707 million The rate on company' short-term notes is equal the market's rate on these notes, which is 5%. What are the company's total invested capital and capital structure weights? What is the company's cost of equity according to CAPM, if the U.S. T-bond yield is 2.00 %, the long-term market risk premium is 6% and the company's levered beta is 1.5? What is the company's WACC? What would be the beta of a similar company that has no debt? You will need to estimate beta of bonds and short term debt using CAPM first "
Paper#8831 | Written in 18-Jul-2015Price : $25