Q397
Cost of common stock is 13% and bond risk premium is 5% then bond yield would be
A.
20.00%
B.
2.60%
C.
8.00%
AnswerD.
18.00%
Answer: Option C
Solution
Answer: Option C
Solution:
Bond Yeild = Cost of common stock - Bond risk premium = 13% - 5% = 8%.