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Appropriate cost for retained earnings

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The Yo-Yo Corporation tries to determine the appropriate cost for retained earnings to be used in capital budgeting analysis. The firm's beta is 2.35. The rate on six-month T-bills is 2.34%, and the return on the S&P 500 index is 7.04%. What is the appropriate cost for retained earnings in determining the firm's cost of capital?

Reference no: EM132714356

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