Question
A firm has a capital structure with $90 million in equity and $30 million of debt. The cost of equity capital is 11% and the
A firm has a capital structure with $90 million in equity and $30 million of debt. The cost of equity capital is 11% and the pretax cost of debt is 5%. If the marginal tax rate of the firm is 25%, compute the weighted average cost of capital of the firm.
| 7.8% | ||
| 9.2% | ||
| 8.3% | ||
| 10.1% |
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Ratios Made Simple A Beginners Guide To The Key Financial Ratios
Authors: Robert Leach
1st Edition
1906659842, 978-1906659844
