Calculate the cost of capital Assuming that there is an unlevered firm and a levered firm. The basic information is given by the following table. Table 1: Information of the firms Unlevered firm...

Calculate the cost of capital

Assuming that there is an unlevered firm and a levered firm. The basic information is given by the following table.

Table 1: Information of the firms

Assuming that cost of debt =8%; unlevered cost of capital =10%; systematic risk of the asset is 1.5