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Blue Star Athletic Apparel has a capital structure of 4 0 % debt and 6 0 % equity. The company s effective corporate tax rate

Blue Star Athletic Apparel has a capital structure of 40% debt and 60% equity. The companys effective corporate tax rate is 25%, and the yield to maturity of the bonds issued by the company is 9%. The CFO has calculated that the companys Weighted Average Cost of Capital is 9.9%. What is the Blue Stars cost of equity capital?

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