You know that the return of Momentum Cyclicals common shares is 1.6 times as sensitive to macroeconomic

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You know that the return of Momentum Cyclicals common shares is 1.6 times as sensitive to macroeconomic information as the return of the market. If the risk-free rate of return is 2.88 percent and market risk premium is 5.92 percent, what is Momentum Cyclicals’ cost of common equity capital?

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Fundamentals of Corporate Finance

ISBN: 978-1119371403

4th edition

Authors: Robert Parrino, David S. Kidwell, Thomas Bates

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