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A company expects to fund its capital budget without issuing any additional shares of common stock. An analyst has gathered the following information: Source of
A company expects to fund its capital budget without issuing any additional shares of common stock. An analyst has gathered the following information:
Source of capital
Capital structure
proportion
Marginal
after-tax cost
Long-term debt
40%
6%
Preferred stock
10%
10%
Common equity
50%
15%
The WACC of the company is calculated as:
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The Private Equity Toolkit A Step By Step Guide To Getting Deals Done From Sourcing To Exit
Authors: Tamara Sakovska
1st Edition
1119697107, 978-1119697107
