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Determine your Weighted Average Cost of Capital (WACC) for the following situation. Assume you are in a 20% tax bracket Loan Type Amount Interest Rate
Determine your Weighted Average Cost of Capital (WACC) for the following situation. Assume you are in a 20% tax bracket
Loan TypeAmountInterest RateTax DeductibleHome Loan$950,0004%YesCar Loan$30,0008%NoCredit Card Loan$20,00020%NoTotal -----------------------------------
For the financial situation above, what is your WACC? Note that only the home loan is tax deductible.
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