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    Subi6519's Avatar
    Subi6519 Posts: 3, Reputation: 1
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    #1

    Feb 19, 2013, 06:56 PM
    cost of debt capital formula
    Please Help!!

    Sprint Nextel Corporation (S) has $22.1 billion in total debt (which approximates its market value.) Each year this debt costs the company about $1.5 billion in interest expense. The company's market capitalization approximates $17.2 billion, its market beta is estimated 2.12, and its marginal tax rate is 35%. Assume that the risk-free rate equals 4.6% and the market premium equals 5%.

    (a) Estimate Sprint Nextel's cost of debt capital. (Round your answer to one decimal place.)
    teacherjenn4's Avatar
    teacherjenn4 Posts: 4,005, Reputation: 468
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    #2

    Feb 19, 2013, 07:07 PM
    You need to attempt to solve your problem. We help, but don't give answers on this site.
    Subi6519's Avatar
    Subi6519 Posts: 3, Reputation: 1
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    #3

    Feb 19, 2013, 07:18 PM
    Quote Originally Posted by teacherjenn4 View Post
    You need to attempt to solve your problem. We help, but don't give answers on this site.
    OK.I will try again.
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