A company has a cost of debt (before tax) of 5.5% and a cost of equity of
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Question:
A company has a cost of debt (before tax) of 5.5% and a cost of equity of 12.8%. In addition, the company has a target capital structure of 30% debt and 70% equity, and a marginal income tax rate of 30%. Given this information, what is the WACC for this company?
- 7.69%
- 10.12%
- 9.33%
- 10.61%
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