Akeya equipment has 6 million shares of common stock


Akeya Equipment has 6 million shares of common stock outstanding. The common stock has a beta of 1.2 and sells for $50 a share. The U.S. Treasury bill is yielding 2 percent that is used for the risk-free rate and the return on the market is 12 percent, which indicates that the market risk premium is 10 percent. What is the cost of common equity (RE)?

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Financial Management: Akeya equipment has 6 million shares of common stock
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