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What is the systematic risk for the companys debts ?

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Cans ASA has a debt ratio of 0.5 . The company's investment beta is 1.1 , while stock beta is 1.5 . Risk free rate is 4 % , and expected return on markedsportfolio is 10%. Disregard tax .

( a) What is the systematic risk for the company's debts ?

( b ) What is the cost of capital to debt ?

( c) What does it mean that the debt has a beta value greater than zero ?

 

Reference no: EM13841583

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