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A company has a target debt-equity ratio of 0.6. (Hint: if you're not sure what to do about debt-equity ratio, watch my YouTube video (https://youtu.be/BAipMtb6N9k)
A company has a target debt-equity ratio of 0.6. (Hint: if you're not sure what to do about "debt-equity ratio", watch my YouTube video (https://youtu.be/BAipMtb6N9k) on that topic! It is also posted in "Step 6" of this week's folder on Blackboard.) The yield to maturity on its bonds is 11 percent. Its cost of equity is 18 percent. The corporate income tax rate is 31 percent. Calculate the WACC for this company.
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