There is a 44 percent chance that casino will default and


The 1-year bonds of Casino, Inc., have a 10.9 percent coupon rate and trade in the market at a yield of 12.2 percent. There is a 4.4 percent chance that Casino will default and pay nothing. What cost of debt should be used in Casino's WACC?

Solution Preview :

Prepared by a verified Expert
Finance Basics: There is a 44 percent chance that casino will default and
Reference No:- TGS02907079

Now Priced at $10 (50% Discount)

Recommended (97%)

Rated (4.9/5)