Styx Company proposes to borrow $10 million capital to expand their operations, $4 million in bonds and the rest in
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- Styx Company proposes to borrow $10 million capital to expand their operations, $4 million in bonds and the rest in common stock. They can issue stocks for $35.00 by paying a dividend of $3.50 next year and maintain a growth rate of 8%. They can issue 20-year bonds for $828.41 paying 8% coupon, paid semi-annually. What is the weighted cost of capital assuming a tax rate of 35%.
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Chapter # 18- Dividend Policy and Retained Earnings
Section: Mini case
Posted Date: September 13, 2023 00:56:48