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Corporate Finance Quiz

1)A company has 20% debt and 80% equity .The post tax cost of debt is 12% . If the WACC for the
company is 15.2% , estimate the cost of equity? (4 marks)

2)A Rs.100 par value bond bears a coupon rate of 12% and matures after 6 years. Interest is payable
semi-annually.Compute the value of the bond if required rate of return is 16%. (6 marks)

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