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Presley Cleaners Has an All-Equity Capital Structure with an Equity

Question 17

Multiple Choice

Presley Cleaners has an all-equity capital structure with an equity value of $94,260.The expected earnings are $11,320 based on estimated sales of $60,000.The firm pays no taxes and can borrow at 6.4 percent.What is the value of RWACC?


A) 12.01%
B) 12.29%
C) 11.83%
D) 12.34%
E) 12.16%

Correct Answer:

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