SIROM Scientific Solutions has $5 million of outstanding equity and $10 million of bank debt....
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Accounting
SIROM Scientific Solutions has $5 million of outstanding equity and $10 million of bank debt. The bank debt costs 4% per year. The estimated equity beta is 2. If the market risk premium is 7% and the risk-free rate is 5%, compute the weighted average cost of capital if the firm's tax rate is 25%.
A. 8.33%
B.8.75%
C. 9.58%
D. 9.17%
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