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A company has the following financing sources. $300 million of debt consisting of bonds with an after tax cost of 6.09% $40 million of preference
A company has the following financing sources.
$300 million of debt consisting of bonds with an after tax cost of 6.09%
$40 million of preference shares with a rate of return of 6%
$350 million of ordinary shares with a rate of return of 15.8%
Calculate the company's after-tax weighted average cost of capital. The tax rate is 30%
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