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you hvae been asked to calculate the cost of capital of CMR inc. The firm...

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Finance

you hvae been asked to calculate the cost of capital of CMR inc. The firm has has 2000 zero coupon bonds. each zero coupon bond has a face. value of $1000, will mature in 7 years from today and is currently priced at 60% of the face value. The company has 500000 common shares outstanding and each share is currently trading at $20. you have decided to use capm to calculate the cost of equity. the risk free rate is 5% and market risk premium is 15%. the beta of the company is 3% and the expected return of the market is. 20%. also the company has 200000 preferred shares. each share is trading at 15 and the constant yearly preferred dividend per share is 1.5. finally the company faces a tax rate of 40%

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