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12) A firm has an equity beta of 1.105 and the market expected rate of return is 25% . The firm
has in issue a 10% irredeemable bond issued at par value of K 1 , 000 with market price of K 1 ,
112 . The interest rate of government bond is 8% . Calculate the cost of capital.

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12) A firm has an equity beta of 1-105 and the market expected rate of.docx

  • 1. 12) A firm has an equity beta of 1.105 and the market expected rate of return is 25% . The firm has in issue a 10% irredeemable bond issued at par value of K 1 , 000 with market price of K 1 , 112 . The interest rate of government bond is 8% . Calculate the cost of capital.