Assume that you are trying to estimate the cost of equity for an average risk (beta =1) Mexican company in US dollars. The US treasury bond rate is 2.2% and the company gets 60% of its revenues in the United States and 40% from Mexico. The equity risk premium for Mexico is 7.5% and the equity risk premium for the US is 5.5%. 

What is the company's US $ cost of equity?

Answer rating: 100% (QA)

To calculate the companys US dollar cost of equity we need to consider the riskfree rate the equity ... View the full answer