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AllCity Inc. is financed 45% with debt, 20% with preferred stock, and 35% with common stock. Its pre-tax cost of debt is 6%; its preferred
AllCity Inc. is financed 45% with debt, 20% with preferred stock, and 35% with common stock. Its pre-tax cost of debt is 6%; its preferred stock pays an annual dividend of $2.50 and is priced at $28. It has an equity beta of 1.4 . Assume the risk-free rate is 2%, the market risk premium is 7%, and A lllity's tax rate is 35%. What is its after-tax WACC? What is its after-tax WACC? rwacc=(Roundtofivedecimalplaces.)
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