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1 . A company s debt ratio is 3 5 % and before tax cost of debt is 1 2 % . Its cost of

1. A companys debt ratio is 35% and before tax cost of debt is 12%. Its cost of equity is around 9.5% and tax rate is 28%. Calculate WACC.
2. A Company relies on 3 sources of funds. These are:
Debt 30% and before-tax cost of debt is 14%
Preferred stock 18% and cost of preferred stock 5%
Remaining Common Stock and cost of common stock 11%
If tax rates are 33%. Calculate WACC.
3. Company raised 5 million funds. Out of which 2 million is via bonds issued at 12% coupon rate and remaining is equity. Companys cost of equity is around 8.5% and it falls under 30% tax bracket. Calculate WACC.
4. A companys debt ratio is 38% and before tax cost of debt is 12% while tax rate is 32%. Companys beta is 1.3, rate on govt. securities is around 7% and market average returns are 13%. Calculate WACC.
5. Company raised 2 million funds via debt and 4 million via equity. Before tax cost of debt is 14%. Tax rate is 30% and cost of equity is 10%. Calculate WACC.

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