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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Financial Markets and Institutions
Authors: Frederic S. Mishkin, Stanley G. Eakins
5th edition
321280299, 321280296, 978-0321280299
