3. What is the? after-tax cost of the following preferred? equity? The par value of...
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3. What is the? after-tax cost of the following preferred? equity? The par value of the preferred share is ?$100 and the annual dividend is ?$5.00. The preferred shares have no stated maturity. The current market price of the share is ?$70. Assume that the corporate tax rate is 39?%.
The? after-tax cost of the preferred equity is ()%. ?(Round to two decimal? places.)
4. Pan American? Airlines' shares are currently trading at ?$71.56 each. The yield on Pan? Am's debt is 66?% and the? firm's beta is 0.7. The? T-Bill rate is 3.5% and the expected return on the market is 8?%. The? company's target capital structure is 40% debt and 60?% equity. Pan American Airlines pays a combined federal and state tax rate of 45%. What is the estimated cost of common? equity, employing the Capital Asset Pricing Model? (CAPM)?
The estimated cost of common equity for Pan American Airlines is ()%. ?(Round to two decimal? places.)
*Please answer both questions.... several of my questions this month was answered wrong and I did not get those questions refunded to me :(
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