Assume corporation has credit rating

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Assume ABC Corporation has a B credit rating, rf = 5%, Rm = 8%, wd = 54%, Tc = 35%.

1) If Be = 1.9, the cost of equity capital, re (on an annual basis) is closest to (CAPM):

2) The cost of debt capital, rd (on an annual basis) is closest to (CAPM):

3) The beta of the project, Bu is closest to:

4) The unlevered cost of capital, ru is closest to (CAPM):

5) The levered cost of equity, rwacc is closest to:

Reference no: EM131585793

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