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Extra 2: BR) Market Risk Fremiummarf WACC wwW.R ACME is trying to determine its optimal capital structure. As capital de contests of det and common
Extra 2: BR) Market Risk Fremiummarf WACC wwW.R ACME is trying to determine its optimal capital structure. As capital de contests of det and common stock. In order to estimate the cost of capital, the company has produced the following table Capital Beforeta weight of Weight Bond Structure Beta cout of Debt of Equity D/E Rating debt 1 1066 0.3 09011 AAA 7.00 115 02 08025 AM 22 3 1.258 0.3 07043A 8 4 1402 04 0.6067 5 1.6 05 1 9.6 ACME's tax bracket is The company uses the CAPM to estimate its cost of equity. The risk-free mis and the market is premium is 6X On the basis of this information, what is the company's optimal capital structure, what is the firm's WACC at this optimal capital structure, and what is the value of the company is hasret flows of Simillion every year? Please complete the table below Value of the firm WACC Capital Cost of Structure Equity 1 2 3 4 5
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