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1. In your opinion, what would be the effect of China’s interest rate liberalization on the global economy?

2. CTO Transport has a pre-tax cost of debt of 5.6%, the expected return for the company stock is 11.45%. The firm’s stock beta is .92, and the rate on Treasury Bills is 1.75%.

The firm has 60,000 shares of common stock outstanding at a market price of $45 a share. The bond issue has a total face value of $400,000 and sells at 103% of face (par) value. The tax rate is 30%. What is CTO Transport's:

Cost of Equity?

After-tax cost of Debt?

Weight of Equity Market Value and Percent?

Weight of Debt Market Value and Percent?

The overall firm WACC?

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M93044022

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