A firm has a target capital structure that consists of 40% of retained earnings and the...
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A firm has a target capital structure that consists of 40% of retained earnings and the rest in debt. The firm's cost of retained earnings is9.3 %. The firm's cost of new debt is similar to the yield to maturity of its existing bonds, which is 7.2%. The firm's tax rate is 30%. Given this information, and given that the firm has no preferred stock, what is the WACC? Answer in percentage without the symbol. A firm has a target capital structure that consists of 40% of retained earnings and the rest in debt. The firm's cost of retained earnings is9.3 %. The firm's cost of new debt is similar to the yield to maturity of its existing bonds, which is 7.2%. The firm's tax rate is 30%. Given this information, and given that the firm has no preferred stock, what is the WACC? Answer in percentage without the symbol.
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Related Book For
Financial Analysis with Microsoft Excel
ISBN: 978-1285432274
7th edition
Authors: Timothy R. Mayes, Todd M. Shank
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