Question
1.Calculate the after-tax WACC based on the following information:nominal interest rate on debt = 10%; cost of common equity = 20%; common equity = $600,000;
1.Calculate the after-tax WACC based on the following information:nominal interest rate on debt = 10%; cost of common equity = 20%; common equity = $600,000; interest-bearing debt = $400,000; and a tax rate = 30%.
a.18.0%
b.12.2%
c.14.8%
d.23.8%
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Equity Asset Valuation
Authors: Jerald E. Pinto, Elaine Henry, Thomas R. Robinson, John D. Stowe, Abby Cohen
2nd Edition
978-0470571439
