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A firm uses only debt and equity in its capital structure. The firm's weight of debt is 75 percent. The firm could issue new bonds

A firm uses only debt and equity in its capital structure. The firm's weight of debt is 75 percent. The firm could issue new bonds at a yield to maturity of 12 percent and the firm has a tax rate of 21 percent. If the firm's WACC is 13 percent, what is the firm's cost of equity?

Multiple Choice

36.00 percent
23.56 percent
38.29 percent
4.00 percent

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