Firm common stock trades, The firm's common stock trades

Firm common stock trades

Assignment Help Financial Management

Reference no: EM131548009

A firm is 65% equity and 35% debt. The firm's marginal tax rate is 40%. Their bonds trade for $990, mature in nine years, have a par value of $1,000, a coupon rate of 8.00% and pay semi-annually. The firm's common stock trades for $27 and just paid a dividend of $5.00. Dividends are expected to grow at 3% forever. The firm's cost of equity is _____%.

Reference no: EM131548009

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