Running Shoes, Inc. has 2 million shares of stock outstanding. The stock currently sells for...
60.1K
Verified Solution
Link Copied!
Question
Finance
Running Shoes, Inc. has 2 million shares of stock outstanding. The stock currently sells for $12.50 per share. The firm's debt is publicly traded and was recently quoted at 90% of face value matures in 10 years. It has a total face value of $10 million, and it has coupon rate of 8%. The risk free rate is 2% and the market risk premium is 8%. You've estimated that the firm has a beta of 1.20. The corporate tax rate is 40%. (refer to this for next three questions) What is the percentage of equity used by Running Shoes, Inc.? O 74.63% 73.53% 72.46% 68.97%
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
