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9. Problem 10.10 (WACC and Percentage of Debt Financing) ebook Olsen Outfitters Inc. believes that its optimal capital structure consists of 30% common equity and
9. Problem 10.10 (WACC and Percentage of Debt Financing) ebook Olsen Outfitters Inc. believes that its optimal capital structure consists of 30% common equity and 70% debt, and its tax rate is 10%. Ose must raise additional capital to fund its upcoming expansion. The firm will have $1 milion of retained earnings with a cost of -10%. New common stock in an amount up to $8 million would have a cost of t. - 13.0%. Furthermore, Olsen can raise up to $4 million of debt at an interest rate of -10% and an additional $6 million of debt - 124. The CFO estimates that a proposed expansion would require an investment of $3.5 million. What is the WACC for the last dollar raised to complete the expansion Round your answer to two decimal places
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