Multiple Choice
Ready Supply Co. has a cost of debt of 8%. The risk-free rate of interest is 3% and the expected return on the market portfolio is 10%. If the firm has a beta of 0.90 and an effective tax rate of 30% with a capital structure that is 40% debt and 60% equity, what is the firm's weighted average cost of capital?
A) 7.82%
B) 9.30%
C) 5.60%
D) 8.00%
Correct Answer:
Verified
Correct Answer:
Verified
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