Computation of cost of capital

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Reference no: EM1315953

Suppose the market risk premium is 6.0% and the risk free interest rate is 3 %.

A. Calculate the cost of capital of investing in a project with a beta of 0.8.

B. If the expected cash flow from this security in one year is $60 with nothing afterwards, what would be the security's market price?

Reference no: EM1315953

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