The issue makes semiannual payments

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1. The Up and Coming Corporation's common stock has a beta of 1.95. If the risk-free rate is 0.04 and the expected return on the market is 0.09, what is the company's cost of equity capital? Enter the answer with 4 decimals (e.g. 0.1234).

2. Waller, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 8 years to maturity twith a current price of $1042. The issue makes semiannual payments and has coupon rate of 8 percent. If the tax rate is 0.40, what is the pretax cost of debt? Enter the answer with 4 decimals (e.g. 0.0123)

Reference no: EM132056610

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