The risk-free rate is 55 the market risk premium is 5 and


Bradshaw steel has a capital structure with 30% debt and 70% common equity. The YTM on the company’s long-term bonds is 8%, and the firm estimates that its overall composite WACC is 10%. The firm uses the CAPM to determine its cost of equity. The risk-free rate is 5.5%, the market risk premium is 5%, and the company’s tax rate is 40%. What is the beta on Bradshaw’s stock? (HINT: use the WACC to find ks, then use the CAPM to solve for the beta)

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Operation Management: The risk-free rate is 55 the market risk premium is 5 and
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