International Financial Management 2nd Edition by Geert Bekaert ,Robert Hodrick

Exercise 11

Web Question: Go to www.vodafone.com and determine the outstanding amounts of debt and equity. If the required rate of return on its debt is 75 basis points over the 10-year U.K. Treasury yield, its equity beta is 0.75, and the equity premium is 5.5%, what is Vodafone's weighted average cost of capital Hint: Don't forget to find the U.K. tax rate.