B what is the market interest rate on harry daviss

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b. What is the market interest rate on Harry Davis’s debt, and what is the component cost of this debt for WACC purposes? 30 | | 60
Homework Solutions – Ch 09 & 10 r d (1 - T) = 10.0%(1 - 0.40) = 10.0%(0.60) = 6.0%. Optional Question Should flotation costs be included in the estimate?
Optional Question Should you use the nominal cost of debt or the effective annual cost?
c. 1. What is the firm's cost of preferred stock?
Homework Solutions – Ch 09 & 10

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