Calculate the risk free rate

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A firm has 5,000,000 shares of common stock outstanding, each with a market 96) price of $8.00 per share. It has 25,000 bonds outstanding, each selling for $800. The bonds mature in 10 years, have a coupon rate of 8%, and pay coupons semi-annually. The firm's equity has a beta of 1.4, and the expected market return is 15%. The tax rate is 35% and the WACC is 15%. Calculate the risk free rate.

Reference no: EM132789693

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