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Answer this question based on the following data for a global firm. average pretax cost of debt = 8 %, average cost of equity =
Answer this question based on the following data for a global firm.
- average pretax cost of debt = 8 %,
- average cost of equity = 13.6 %,
- average tax rate = 40 %,
- the firm raises funds by borrowing 20 million dollar and issuing equity in the amount of 30 million dollar.
The after-tax weighted average cost of capital of this firm is:
a. 10.08%
b. 11.36%
c. 13.60%
d. 4.8%
None of the answers in this question are correct.
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