First Data Co. has 20 million shares of common stock outstanding that are currently being sold for
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First Data Co. has 20 million shares of common stock outstanding that are currently being sold for \($25\) per share. The firm’s debt is publicly traded at 95 percent of its face value of \($180\) million. The cost of debt is 10 percent and the cost of equity is 20 percent. What is the weighted average cost of capital for the firm? Assume the corporate tax rate is 40 percent.
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