What is the overall cost of capital

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1. You are analysing the cost of capital for a company that is financed with $300 million of equity and $200 million of debt. The cost of debt capital for the company is 9 percent, while the cost of equity capital is 29 percent. What is the overall cost of capital for the company?

13.0%

14.0%

15.0%

21.0%

2. Horse Stock returns have exhibited a standard deviation of 0.57, whereas Mod T Stock returns have a standard deviation of 0.63. The correlation coefficient between the returns is 0.070842. What is the covariance of the returns?

0.028025

0.217327

0.025439

0.993094

Reference no: EM133239596

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