## [answered] A corporation has an optimal capital structure of 40 per ce

A corporation has an optimal capital structure of 40 per cent debt and 60 per cent equity. The 2011 investment opportunity schedule totals \$4 200. If the 2010 retained earnings are \$3 000 and the firm follows the residual theory of dividends, it would pay ________ in dividends.

Select one:

A. \$1 320B. \$1 800C. \$0D. \$480

A firm has a beta of 1.2. The market return equals 14 per cent and the risk-free rate of return is 6 per cent. The estimated cost of ordinary share equity capital is:
Select one: A. 6 per cent. B. 14 per cent. C. 15.6 per cent. D. 7.2 per cent.

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