Assume ABC Corporation has a B credit rating, rf = 5%, Rm = 8%, wd = 54%, Tc = 35%.
1) If Be = 1.9, the cost of equity capital, re (on an annual basis) is closest to (CAPM):
2) The cost of debt capital, rd (on an annual basis) is closest to (CAPM):
3) The beta of the project, Bu is closest to:
4) The unlevered cost of capital, ru is closest to (CAPM):
5) The levered cost of equity, rwacc is closest to: