Asked by Lisa

Morningside Nursing Home, a not-for-profit corporation, is estimating its corporate cost of capital. Its tax-exempt debt currently requries an interst rate of 6.2 percent and its target capital structure calls for 60 percent debt fianancing and 40 percent equity (fund capital) financing. The estimated costs of equity for selected investor-owned healthcare comapnies are given below:

Glaxo Wellcome 15.0%
Beverly Enterprises 16.4
HealthSouth 17.4
Humana 18.8
1. What is the best estimate for Morningside's cost of equity?

2. what is the firm's corporate cost of capital?

Answers

Answered by Ms. Sue
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Answered by Lisa
okay, any step in the right direction would help
Answered by melinda
what is the tax rate
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