ECC has an equity ratio of 30 %. The debt capital consists of two bank loans...
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ECC has an equity ratio of 30 %. The debt capital consists of two bank loans and two bonds. The first Bond was issued 6 years ago at a coupon rate of 8,5 % and represents 40 % of ECC's debt; Bond 2 was issued 2 years ago at a coupon rate of 6,5 % and represents 30% of ECC's debt. The interest rate of bank loan 1 is at 6,5 %; the interest rate of bank loan 2 (which is half the amount of bank loan 1) is at 4,5 %. Please calculate the WACC. (5 points) ECC has an equity ratio of 30 %. The debt capital consists of two bank loans and two bonds. The first Bond was issued 6 years ago at a coupon rate of 8,5 % and represents 40 % of ECC's debt; Bond 2 was issued 2 years ago at a coupon rate of 6,5 % and represents 30% of ECC's debt. The interest rate of bank loan 1 is at 6,5 %; the interest rate of bank loan 2 (which is half the amount of bank loan 1) is at 4,5 %. Please calculate the WACC. (5 points)
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To calculate the Weighted Average Cost of Capital WACC we need to determine the cost of each compone... View the full answer
Related Book For
Calculus For Scientists And Engineers Early Transcendentals
ISBN: 9780321849212
1st Edition
Authors: William L Briggs, Bernard Gillett, Bill L Briggs, Lyle Cochran
Posted Date:
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