Question: Rogot Instruments makes fine violins, violas, and cellos. It has $1 million in debt outstanding, equity valued at $2 million, and pays corporate income tax

Rogot Instruments makes fine violins, violas, and cellos. It has $1 million in debt outstanding, equity valued at $2 million, and pays corporate income tax at a rate of 35%. Its is 12% and its is 7%.
a. What is Rogot’s pretax WACC?
b. What is Rogot’s (effective after-tax) WACC?

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