Finance

Suppose it's January 2021 and you would like to estimate the unlevered cost of capital (r ) for Cowbell Corp. The current share price of Cowbell is $18 and there are 10 million shares outstanding.You have estimated Cowbell's equity beta as 1.25 ,and its cost of debt (r ) as 276%. The risk-free rate is 1.9% and the market risk premium is 60/0. In addtion, the table below shows the current balance sheet of the firm. Assume that all cash and short-term investments are excess cash. Based on the information provided, what is the best estimate the unlevered cost of capital for Cowbell? Select one. Balance Sheet (in *millions) Cash & Short-Term Investments Accounts Receivable Inventory Other Current Assets Total Cur rent Assets Property, Plant & Equipment Less Accumulated Depreciation Net Property, Plant & Equipment Goodwill & Intangible Assets Other Long-Term Assets Total Assets 0 1.680% 0 2.5.02% 0 3.5.60% 2020 $10.00 $30.00 $15.00 $4.00 $59.00 $150.00 ($40 00) Silom S 18.00 $23.00 $21000 Lia bilities Accounts Payable Short-Term Debt Current Maturities of Long-Term Debt Other Current Liabilities Total Current Liabilities Long-Term Debt Capital Lease Obligations Total Debt Deferred Taxes Other Long-Term Liabilities Total Liabilities Shareholders' Equity Total Liabilities and Shareholders' Equity $10.00 Ss .00 $15.00 Sg.oo $39.00 550.00 Sooo ($12 00) $22.00 $99.00 $111.00 $210.00