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What is zeel weighted average cost of capital

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Reference no: EM132609426

Question 1: Zeel Company has 100 000 bonds outstanding that are selling at R1000. Bonds with similar characteristics are yielding 7.5%. The company has 1 million shares of preferred stock outstanding and 5 million shares of common stock outstanding. The preferred stock sells for R50 per share and R10.5 dividends. The common stock has a beta of 1.2 and sells for R36 a share. The risk free rate is 3% and the return on the market is 12%. The company's marginal tax is 35%. What is Zeel's weighted average cost of capital?

Reference no: EM132609426

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