Suppose that TapDance, Incorporated s capital structure features 7 0 percent equity, 3 0 percent debt, and

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Suppose that TapDance, Incorporated

s capital structure features

70

percent equity,

30

percent debt, and that its before

-

tax cost of debt is

8

percent, while its cost of equity is

13

percent. The appropriate weighted average tax rate is

21

percent and TapDance estimates it cannot make any use of the interest tax shield in the foreseeable future.

Posted Date: May 19, 2024 02:00 AM

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Suppose that TapDance, Incorporated s capital structure features 7 0 percent equity, 3 0 percent debt, and

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