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Coffee Stop primarily sells potee. It recently introduced a premium coffee-flavored liquor (BF Liquors). Suppose the firm faces a tax rate of 40% and collects

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Coffee Stop primarily sells potee. It recently introduced a premium coffee-flavored liquor (BF Liquors). Suppose the firm faces a tax rate of 40% and collects the following information. If it clans to finance 11% of the now liquor-focused division with debt and the rest with equity, what WACC should it use for its liquor division? Assume a cost of debt of 52%, a risk-free rate of 2.5%, and a market risk premium of 68% Beta % Equity % Debt CoffeeStop 0.59 94% 6% BF Liquors 0.23 89% 11% Nole. Assume that the timm will always be able to use its full interest tax shield Tive weighted average cost of capital is %. Round to wo decimal places.)

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