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A Firm Requires an Investment of $60,000 and Borrows $20,000

Question 86

Multiple Choice

A firm requires an investment of $60,000 and borrows $20,000 at 8%. If the return on equity is 14% and the tax rate is 30%, what is the firm's WACC?

A) 11.2%
B) 9.0%
C) 13.4%
D) 22.4%

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