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A firm is using $40 million in debt, $10 million in preferred stock, and $50 million in common equity to finance its assets. If the
A firm is using $40 million in debt, $10 million in preferred stock, and $50 million in common equity to finance its assets. If the before tax cost of debt is 4%, cost of preferred stock is 10%, and the cost of common equity is 14%; calculate the weighted average cost of capital for the firm assuming a tax rate of 21%. 6.51% 9.26% 7.66% 8.30%
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