Question: Question 4 10 pts Use the following data for securities issued by LuccasenCorp. to answer questions 1 - 5: Bonds: The company issued 240,000 bonds.

Question 4 10 pts Use the following data for securities issued

Question 4 10 pts Use the following data for securities issued by LuccasenCorp. to answer questions 1 - 5: Bonds: The company issued 240,000 bonds. The bonds have a $1,000 face value with 8.5% coupons with annual payments, 25 years to maturity, and currently sell for $940. The marginal tax rate is 4%. Equity: The company has 9,000,000 shares of (common) stock outstanding, selling for $68 per share. The company's beta is 1.25, the risk free rate is 1%, and the market risk premium is 8%. 4. What is the cost of equity? Edit View Insert Format Tools Table 12pt Paragraph v B IV AT? V Ov Cav v

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