Worth of common equity, The balance sheet reports that they

Worth of common equity

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Reference no: EM132062693

Go-Go Inc. is thinking about investing in a new project. The balance sheet reports that they currently have $22 million worth of long-term debt and $18 million worth of common equity. Their current cost of debt is 4%. According to Yahoo.Finance.com the current required return to Go-Go's stock is 11%, the company has $2 million shares of stock outstanding and the stock currently trades for $32 per share. If their average tax rate is 34% and they have no preferred stock, what Go-Go's weighted average cost of capital? 9.21% 8.86% 6.40% None of these 7.50%

Reference no: EM132062693

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