Question: Deere's construction co. has 80 bonds outstanding with 6 % annual coupon rate, 8 years maturity, a $1000 face value, and a $1100 market price.

Deere's construction co. has 80 bonds outstanding with 6 % annual coupon rate, 8 years maturity, a $1000 face value, and a $1100 market price. The firm also has 4000 shares of common stock outstanding. The stock has a beta of 1.1 and sells for $40

what is the cost of equity

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