问题
单项选择题
A firm has $4 million in outstanding bonds that mature in four years, with a fixed rate of 7.5% (assume annual payments). The bonds trade at a price of $98 in the open market. The firm’s marginal tax rate is 35 %. Using the bond-yield plus method, what is the firm’s cost of equity risk assuming an add-on of 4%（）
A. 13.34%.
B. 11.50%.
C. 12.11%.
答案
参考答案：C
解析：
If the bonds are trading at $98, the required yield is 8.11% , and the market value of the issue is $3.92 million. To calculate this rate using a financial calculator ( and figuring the rate assuming a $100 face value for each bond), N=4, PMT=7.5 =(0.075 ×100), FV=100, PV = -98, CPT I/Y = 8.11. By adding the equity risk factor of 4% , we compute the cost of equity as 12.11%.