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Weighted average cost of capital- crypton electronics has a capital structure consisting of 38% common stock and 62% debt. A debt issue of 1,000, par value 6.5% bonds that mature in 15 years and pay
annual interest will sell for 970. Common stock of the firm is currently selling for 29.18 per share and the firm expects to pay a 2.31 dividend next year. Dividends have grown at a rate of 4.9% per year and are expected to continue to do so for the foreseeable future. What is cryptons cost of capital where the firms tax rate is 30% Crypton s cost of capital is ? %. (round to three decimal places)
Crypton's cost of capital is at 9.70 percent.
Expert answered|jeo007|Points 50|
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Asked 7/3/2013 5:35:47 AM
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