General Talc Mines has compiled the following data regarding the market value and cost of the...
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General Talc Mines has compiled the following data regarding the market value and cost of the specific sources of capital. Source of Capital Long-term debt Common stock equity Before-Tax Cost 8% 19 Market price per share of common stock $50 (7,200 shares outstanding) Market value of long-term debt is $980 per bond (150 bonds issued at $1,000 par) Tax rate is 20%. What is the weighted average cost of capital using market value weights? General Talc Mines has compiled the following data regarding the market value and cost of the specific sources of capital. Source of Capital Long-term debt Common stock equity Before-Tax Cost 8% 19 Market price per share of common stock $50 (7,200 shares outstanding) Market value of long-term debt is $980 per bond (150 bonds issued at $1,000 par) Tax rate is 20%. What is the weighted average cost of capital using market value weights?
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To calculate the weighted average cost of capital WACC using market value weights we need to determi... View the full answer
Related Book For
Financial Management Theory and Practice
ISBN: 978-1305632295
15th edition
Authors: Eugene F. Brigham, Michael C. Ehrhardt
Posted Date:
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