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Cameron Corp. has a target capital structure of 40% debt and 60% equity. The company's tax rate is 30% and the yield to maturity on
Cameron Corp. has a target capital structure of 40% debt and 60% equity. The company's tax rate is 30% and the yield to maturity on their outstanding bonds is 12%. If their weighted average cost of capital is 9.6%, what is the company's cost of common equity? (If taxes are a negative number then they will be refunded by the IRS, creating a positive cash flow.) Multiple Choice 0 5.8% 0 9.3% 0 10.4% 0 13.6%
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