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5. The weighted average cost of capital for firm X is currently 12%. Firm X is considering a new project but must raise new debt

5. The weighted average cost of capital for firm X is currently 12%. Firm X is considering a new project but must raise new debt to finance the project. Debt represents 25% of the capital structure. If the after tax cost of debt will rise from 6% to 7%, what is the new cost of capital?

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