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Company A is financed by 17% of debt and the rest of the company is financed by common equity. The companys before-tax cost of debt
Company A is financed by 17% of debt and the rest of the company is financed by common equity. The companys before-tax cost of debt is 3.8%. Currently the risk-free rate is 1.7%, the market risk premium is 6%, and the stock has a beta of 2.1. If company A faces a marginal tax rate of 30%, its weighted average cost of capital (WACC) should be _____.
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