A company has a cost of equity of 15%, cost of debt of 10%, and a tax
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4. A company has a cost of equity of 14%, cost of debt of 9%, and a tax rate of 35%. If the company's debt-to-equity ratio is 0.75, what is the WACC?
5. A company has a market value of equity of $2,000,000, market value of debt of $1,000,000, cost of equity of 10%, cost of debt of 6%, and a tax rate of 25%. What is the WACC?
6. A company has a market value of equity of $1,000,000, market value of debt of $500,000, cost of equity of 12%, cost of debt of 8%, and a tax rate of 30%. What is the WACC?
7. Metals Corp. has $575,000 of debt, $50,000 of preferred stock, and $1,125,000 of common equity. Metals Corp.'s after-tax cost of debt is 4.25%, preferred stock has a cost of 5.35%, and newly issued common stock has a cost of 12.75%. What is Metals Corp.'s weighted average cost of capital?
Related Book For
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
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