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| Subject:
Finance/Accounting
Category: Business and Money > Finance Asked by: muntzster-ga List Price: $14.50 |
Posted:
02 Sep 2005 21:40 PDT
Expires: 03 Sep 2005 09:57 PDT Question ID: 563789 |
Try Number 2: Rayburn manufactoring is currently an all equity firm that pays no taxes. The market value of the firm's equity is 2 million. The cost of unlevered equity is 18% per annum. Rayburn plans to issue $400,000 in debt and use the proceeds to repurchase stock. The cost of debt is 10% per annum. After Rayburn purchases stock what will the WACC be? After the repurchase what will the cost of equity be? Why? Using the cost of equity answer what is the new WACC after repurchase of stock? |
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| Subject:
Re: Finance/Accounting
From: livioflores-ga on 02 Sep 2005 22:28 PDT |
Hi!! I just answered this question for you, see: https://answers.google.com/answers/threadview?id=563723 |
| Subject:
Re: Finance/Accounting
From: livioflores-ga on 02 Sep 2005 22:30 PDT |
I suggest you to cancel this question in order to prevent be double chargeg for the same answer. |
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