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Compute the weighted average cost of capital (WACC) for Company FFF, which has a cost of equity of 12%, a cost of debt of 6%,

  • Compute the weighted average cost of capital (WACC) for Company FFF, which has a cost of equity of 12%, a cost of debt of 6%, and a corporate tax rate of 30%. The company's target capital structure consists of 60% equity and 40% debt. Discuss the significance of WACC as a discount rate for investment analysis and capital budgeting decisions.

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