Examveda
Examveda

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%

D. 18.00%

Answer: Option C

Solution(By Examveda Team)

Bond Yeild = Cost of common stock - Bond risk premium
= 13% - 5% = 8%.

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