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Estimating Weighted Average Cost of Capital Assume that a company has $1 billion in preferred stock and $3 billion in common stock. Also, it pays

Estimating Weighted Average Cost of Capital

Assume that a company has $1 billion in preferred stock and $3 billion in common stock. Also, it pays 6% dividends on preferred stock and its cost of equity capital is 7%. The company has no debt. Compute the companys WACC.

Round answers to two decimal places (ex: 0.02345 = 2.35%)

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