solve and answer correcr 7. A company has outstanding bonds with a...
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solve and answer correcr
7. A company has outstanding bonds with a YTM of 8%, a required return on equity of 10%, a marginal tax rate of 21% and a target capital structure consisting of 2/3 debt and 1/3 equity. What is the weighted average cost of capital for this firm? 8. Please calculate the WACC given the following information. (2 pts) Corporate tax rate 21% Market value Weight Bonds $ 1,000,000 Stocks $ 600,000 Loans $ 400,000 Before-tax required return Bonds 4% Stocks 8% Loans 5% WACC
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