Zynk inc is a privately owned firm has a cost of debt, Ask an Expert

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Zynk, Inc. is a privately owned firm, has a cost of debt capital of about 8.4%, which is the average cost of debt of its industry. The average equity beta in its industry is 1.35, and the average firm in the industry employs 1.5 times as much equity as debt. As represented on its balance sheet, Zynk has %250 million in debt and $950 million in equity. Obtain an estimate of Zynk's cost of equity capital and its WACC.

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Financial Management, Finance

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