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Business, 03.05.2021 23:40 marissaa190

Bacchus Enterprises has $112M in face value of debt being sold at 92.5% of face value, $247M of market value common stock with a beta of 1.48. The preferred stock is selling at $98 a share with 500,000 shares outstanding and a book value of $38.9M and a return of 12.4%. The debt has a coupon of 8% and will mature in 5 years. The market is returning 10% with a risk free rate of 3%. The company is sitting in the 21% tax bracket. What is the Cost of Debt

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Bacchus Enterprises has $112M in face value of debt being sold at 92.5% of face value, $247M of mark...
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