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ABC Corp's combined marginal state, local, and federal tax rate was 35%. The 10-year Treasury bond rate is 2% and the borrowing rate for companies
ABC Corp's combined marginal state, local, and federal tax rate was 35%. The 10-year Treasury bond rate is 2% and the borrowing rate for companies exhibiting similar levels of creditworthiness is 6%. The historical risk premium for stocks over the risk free rate of return is 5.5%. The firm's beta was estimated to be 1.1. The firm's debt to equity ratio is 20%.
The after-tax cost of debt of the firm is _____
The cost of equity of this firm is ______
The weighted average cost of capital (WACC) of this firm is ________
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