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The financial analyst at Roberts' Caf wants to compute the company's weighted average cost of...

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Accounting

The financial analyst at Roberts' Caf wants to compute the company's weighted average cost of capital (WACC). The following table summarizes the available information:

Before-tax cost of new debt8%

Tax rate40%

Target debt-to-equity ratio0.8033

Stock Price$30

Next year's dividends$1.50

Estimated growth rate7%

Roberts' WACC is closest to:

Group of answer choices

10%

9%

7%

12%

Answer & Explanation Solved by verified expert
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