Read through the information below and answer the questions that follow. * a.This part...

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Accounting

Read through the information below and answer the questions that follow.
* a.This part of the question has three different scenarios for the calculation of weighted average cost of capital (WACC) and asks you to explain some issues surrounding it.
* i.Crypton SRL has 5 million shares in issue. The current market price is 5 per share. The companys debt is publicly traded on the Paris Stock Exchange and the most recent quote for its price was at 70% of face value. The debt has a total face value of 10 million and Cryptons credit risk premium is currently 5%. The risk-free rate is 3% and the equity market risk premium is 5%. The companys beta is estimated at 1.4 and its corporate tax rate is 40%. Calculate Crypton SRLs WACC.

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