Company VL Inc. wants to figure out its WACC. It decides to use the CAPM to calculate its required cost of equity. It has a beta of 1.1, the current short term risk free rate is 4.0%, the current long term risk free is 4.1%, the average historical stock market return is 9.9% and the average of historical long term risk free rate is 3.8%. Without consider flotation cost, what is the required cost of equity for the company?

Answer rating: 100% (QA)

The Capital Asset Pricing Model CAPM is widely used to calculate a companys required rat... View the full answer