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Author Question: Initech has 7 million shares of common stock outstanding and 50,000 bonds outstanding. The bonds pay ... (Read 74 times)

jilianpiloj

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on: Apr 25, 2021
Initech has 7 million shares of common stock outstanding and 50,000 bonds outstanding. The bonds pay semi-annual coupons at an annual rate of 9.05%, have 6 years to maturity and a face value of $1,000 each. The common stock currently sells for $30 a share and has a beta of 1. The bonds sell for 94% of face value and have a 10.42% yield to maturity. The market risk premium is 5.5%, T-bills are yielding 5% and the tax rate is 30%. What is the firm's capital structure weight for debt?
◦ 18.3%
◦ 19.3%
◦ 20.3%
◦ 21.3%
◦ 22.3%
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
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Marked as best answer by jilianpiloj on Apr 25, 2021

chevyboi1976

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Reply #1 on: Apr 25, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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jilianpiloj

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Reply 2 on: Apr 25, 2021
YES! Correct, THANKS for helping me on my review

tuate

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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