Multiple Choice
A firm has a total value of $500,000 and debt valued at $300,000. What is the weighted average cost of capital if the after tax cost of debt is 9% and the cost of equity is 14%?
A) 7.98%
B) 10.875%
C) 11.000%
D) 12.125%
E) It is impossible to determine WACC without debt and equity betas.
Correct Answer:
Verified
Correct Answer:
Verified
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