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1. Assume ABCo has three sources of funds as noted below. What are the weights that would be assigned to each source of funds in

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1. Assume ABCo has three sources of funds as noted below. What are the weights that would be assigned to each source of funds in determining ABCo's weighted average cost of capital (WACC)? a. Debt $100,000 b. Common stock $ 2,100,000 c. Preferred stock $900,000 2. Assume ABCo pays the following average returns on each source of funding. What is ABCo's WACC? a. Debt 5% b. Common stock 9% C. Preferred stock 6% 3. Assume BCDE's tax rate is 35% and it pays 7.6% interest on its bonds. Calculate BCDE's after-tax cost of debt

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