Question
A company has 30 million shares outstanding trading for $8 per share. It also has $90 million in outstanding debt. If its equity cost of
A companyhas 30 million shares outstanding trading for $8 per share. It also has $90 million in outstanding debt. If its equity cost of capital is 15%, and its debt cost of capital is 9%, and its effective corporate tax rate is 40%, what is its weighted average cost of capital? (Show workings)
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Basic Finance An Introduction To Financial Institutions, Investments, And Management
Authors: Herbert B. Mayo
12th Edition
1337691011, 978-1337691017
