Question
c2 QUESTION 2 The capital structure for the GEN-Z Berhad is provided here: Capital structure RM000 Bond 4,000 Preferred Stock 3,000 Common Stock 13,000 The
c2 QUESTION 2
The capital structure for the GEN-Z Berhad is provided here:
| Capital structure | RM000 |
| Bond | 4,000 |
| Preferred Stock | 3,000 |
| Common Stock | 13,000 |
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The firm is in a 25% tax bracket and plans to maintain its capital structure in the future. If the firm has a 7% before-tax cost debt, a 12% cost of preferred stock, and a 16% cost of common stock, what is the firms weighted average cost of capital (WACC)?
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Based on your answer in a), if the company has an opportunity to invest in new project with expected return of 22%, should the company invest in the new project? Why?
please give all answer don't give hand write , thank you
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