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Hampton Corporation has a beta of 1.47 and a marginal tax rate of 21%. The expected return on the market is 15% and the risk-free interest rate is 4.49%. Estimate the firm's cost of internal equity. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7000%, FOR EXAMPLE, ENTER 7.70.

Hampton Corporation has a beta of 1.47 and a marginal tax rate of 21%. The expected return on the market is 15% and the risk-free interest rate is 4.49%. Estimate the firm's cost of internal equity. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7000%, FOR EXAMPLE, ENTER 7.70.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Hampton Corporation has a beta of 1.47 and a marginal tax rate of 21%. The expected return on the market is 15% and the risk-free interest rate is 4.49%. Estimate the firm's cost of internal equity. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7000%, FOR EXAMPLE, ENTER 7.70.
Transcribed Image Text:Hampton Corporation has a beta of 1.47 and a marginal tax rate of 21%. The expected return on the market is 15% and the risk-free interest rate is 4.49%. Estimate the firm's cost of internal equity. SET YOUR CALCULATOR TO 4 DECIMAL PLACES AND ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. IF YOUR ANSWER IS 7.7000%, FOR EXAMPLE, ENTER 7.70.
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