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A firm typically finances with 50% common stock, 40% debt, and the remainder of its financing with preferred stock. You have estimated that the firm
A firm typically finances with 50% common stock, 40% debt, and the remainder of its financing with preferred stock. You have estimated that the firm has an after-tax cost of common stock of 14%, an after-tax cost of preferred stock of 5%, and an after-tax cost of debt of 4%. Estimate the WACC for this firm. 40% tax rate
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