Multiple Choice
Pacifica Inc.is an import-export company specializing in products from Canada,Australia,and the West Coast.It can borrow in the debt market at 6%.Its cost of equity with 30% D/V ratio is 11%.Its corporate tax rate is 25%.If the M&M world of taxes holds true,what is the WACC for the firm with a 30% D/V financing?
A) 7.90%
B) 8.75%
C) 9.05%
D) 9.44%
Correct Answer:
Verified
Correct Answer:
Verified
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