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Compute Frills implied cost of equity using the following information from publicly traded pure play...

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Finance

Compute Frills implied cost of equity using the following information from publicly traded pure play womens online retailers. Assume that the risk-free rate is 2%, the expected market return is 7%, and that Frill faces a 30% tax rate and has 0.3 debt-to-equity ratio.

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Comp A Comp B Comp C Equity Beta 2.5 2.0 1.6 Debt/Equity ratio 0.65 0.50 0.45 Tax rate 0.40 0.35 0.30

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