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7. A firm is financed with 20% long-term debt and 80% common stock. Assume that the estimated cost of equity is 15% and the cost

7. A firm is financed with 20% long-term debt and 80% common stock. Assume that the estimated cost of equity is 15% and the cost of comparable debt is 5%. The corporate tax rate is 40%. Compute the WACC.

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