Ampex common stock has a beta of 1.4. If the risk free rate is 8%, the expected market return is 16...

Question

Ampex common stock has a beta of 1.4. If the risk free rate is 8%, the expected market
eturn is 16 %, and Ampex has $20 million of 8% debt, with a yield to maturity of 12%
and a margin tax rate of 50%. D/E of the company is 2.0. What is the weighted average cost
of capital for Ampex?...

Robert · Accepted Answer

Ampex common stock has a beta of 1.4. If the risk free rate is 8%, the expected market 
return is 16 %, and Ampex has $20 million of 8% debt, with a yield to maturity of 12% 
and a margin tax rate of 50%. D/E of the company is 2.0. What is the weighted average cost 
of capital for Ampex?

Ampex common stock has a beta of 1.4. If the risk free rate is 8%, the expected market return is 16 %, and Ampex has $20 million of 8% debt, with a yield to maturity of 12% and a margin tax rate of...

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