The Yo-Yo Corporation tries to determine the appropriate cost for retained earnings to be used in capital
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Question:
The Yo-Yo Corporation tries to determine the appropriate cost for retained earnings to be used in capital budgeting analysis. The firm's beta is 0.61. The rate on six-month T-bills is 2.63%, and the return on the S&P 500 index is 6.71%. What is the appropriate cost for retained earnings in determining the firm's cost of capital?
Round the answers to two decimal places in percentage form.
Related Book For
Foundations of Financial Management
ISBN: 978-1259024979
10th Canadian edition
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen, Doug Short, Michael Perretta
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